LLC Benefits

Do I need to have an LLC for any type of Real Estate Transaction?
What if I just want Find>Pass>Make Money.
I quess my question is do I need to have an LLC to Start?

You do not need an LLC for any real estate transaction.

Question: Can you purchase a house for you to live in without an LLC? Yes.
If you can buy real estate on your own for your own uses without an LLC then you do not need an LLC when you are investing in real estate.

LLC's serve really two purposes: 1) Anonymity 2) Tax Benefits.

People are often afraid of lawsuits. Because of this they get an LLC to take the fall or suit instead of the personal person.

People also get LLC's or other business structures because they want tax write offs. The government gives us more tax write offs by being a business than at any other time.

Who did u use to get your llc and your domain with for a 100 that would really help me thank you in advance bran new just 2 weeks in thanks chon.

I need advice as to which state to form my LLC in,I`ve read that forming a Delaware Series LLC in which each property is transferred by deed in a seperate "series" would acheive my goal of asset protection & saving money,basically which state is the best for forming a LLC in. Jerome

"make sure that no personal finances get mixed with the LLC or then you will be liable" Not true or how would the LLC get the money to get started? You do need to keep records no matter what. If the IRS comes knocking you should always be ready if you are a business. liable is a legal term and a lawyer should be consulted on exactly what that is. But if every time some personal money went back and forth the LLC was worthless then that form of business would stop. Get a CPA to help you understand what is allowed and what is not. There is also the S Corporation. There are many ways of doing business and you can change from some to some others but it could have tax consequences. The cost of a CPA and an attorney are cheap compared to what it could cost you if you make a mistake. I would always recomend consulting with them when forming a business. If nothing else pay for an hour to sit down and ask your questions but keep them to accounting with the CPA and legal with the lawyer but those two cross over. Do not ask about business strategy because you can ask anyone and save your money. With today's software keeping good records is easy.

I live in SC and I applied for my LLC through LegalZoom.com. The total amount I had to pay was $218 and this included $110 filing fee. My registered agent is my daughter. It took a while to get it right because the first name I used was not available and I changed it. I am just waiting for it to be sent now! Then I have to get my EIN # from the IRS.

Shirley

Hi
LLC has advantages and disadvantages...depends on how you use it...you start out with bad credit you just have to use cash money until you get established...it will take awhile to get corporate credit but you have to work at it to get your company to work for you...Duns & Brad St Can help you do that but there are fees involved...I'm no expert at all but in my experience is that if you don't tend to your garden it will die....Take baby steps it will adveturally work for you...I have bad credit it was because I had listened to the wrong people on how to run my business and it failed if I had just done what I wanted it would be still going...I ended up getting a loan but it took me awhile, I worked hard, I had to prove to the president of the bank that I can profit and if the market falls that I still can make a profit...It wasn't easy, took me a month to get my loan and alot of hours and figuring what way would be the best business plan...The question you asked can you get a loan with bad credit for your business....Yes you just have to work harder at it and prove to the banker that you can make it happen..I hope that this helped you out...
Debora

Good job on the follow through. Keep in mind that most all the roadblocks can be overcome if you use some persistence. You are pretty well set up for your business. I applaud your efforts. Keep going.

Hi I'm trying to figure out which state I pick to start my LLC. Since I don't have any money of my own I'm planning on using hard money lenders like insider's cash. In order to use there money or proof of fundsI need an LLC. Do I pick the state I'm in?

What paper work i have to do for the SCORP in NC State for initial set up as well as ongoing every year.

I see for LLC every year we need to pay 200$ to the state vs only 18$ for SCORP.

so i dont understand why people go for LLC and pay 200$ every year when they can go to Scorp and pay 18$..

i am thinking its better to go with Scorp and then i feel its ok to deal with the paper work and just pay 18$ rather than paying 200$ for LLC...(not clear how much paper work it would be more for SCORP when compared to LLC)

BTW, FOR REAL ESTATE business I'm told LLC is better, not sure why?

I'll need one shortly.

Hi everyone my name is Michelle I am new here, I have been reading this thread (first page) it was mentioned that the LLC formation should not be the first thing on the list to do when starting in REI, what should be the first thing.

My partner and I are looking to form one, do you need to also get a business license or dba before forming the llc as well. I am in Nassau county in NY. Any suggestions.

Michelle

For information on forming an LLC, go to the Secretary of State's webpage for your State or whichever State where you would like to form your LLC, and you will find information on costs and what is needed to form your LLC.

If you form an LLC in a State other than where you live, you will most likely need to still register your 'Foreign' (i.e. out-of-State) LLC with your State's Secretary of State office and pay a separate fee to register your Foreign LLC.

You can search for LLC formation as many companies will file the necessary paperwork for you (either Foreign or Domestic {Domestic = in-State}} for a fee. These fees to register your LLC are in addition to any State fees to file your LLC and range from about $49 - 100, give or take. If you have a 'Foreign' LLC, you will also have to have a Registered Agent in the State of formation (again for another fee).

--Walter

'If it is to be, it is up to me'. -Unknown

One question on this, is a LLC still needed with this or not. Anyone know, I am still reading this thread really great tips offered. I am very interested in the SDIRA as is my business partner. Thanks

Michelle

Michelle,

Sure you can buy properties through a Self Directed IRA account (if you have one or convert your existing IRA to a self directed one), but understand that you CANNOT TAKE ANY PROFITS from any such transactions. ALL profits would be returned to your Self Directed IRA account. If and when you turn 59 1/2 you can begin to take distributions from your Self Directed IRA, but not before then.

Also your Self Directed IRA cannot fund transactions for your purchases that you or your entity would profit from, as that is known as self-dealing and again prohibited by IRS rules. A great book on this subject is 'How to Invest in RE with your IRA & 401k & Pay Little or No Taxes' by Hubert Bromma. A company to help you set up your Self Directed IRA is Entrust; they have local franchises throughout the U.S.

--Walter

'It it is to be, it is up to me'. -Unknown

Ok thanks Walter.

Michelle

We were told it is $1,000 to file an LLC in Tx & Dean has an affiliate who will do it for $495, but can we do it for less somehow?
How did you find the forms to do these documents? How much did it end up costing you?
Tks, we're newbies...

Hi Im just getting into this buisness, Would love to talk to you more about how you started your LLC for only $50. And how you went about getting your first property under your LLC.

Hi Im just getting into this buisness, Would love to talk to you more about how you started your LLC for only $50. And how you went about getting your first property under your LLC.

Hi Im just getting into this buisness, Would love to talk to you more about how you started your LLC for only $50. And how you went about getting your first property under your LLC.

I have a property I purchasedin 2007, got a mortgage on it in 2008, have ~$50k equity in it. Can I create and LLC and move the property into it and tap that equity for more deals?

you are not laible excpte the IRS or the board of equalization.

This has been a real helpful thread of comments!
Very very true!
This forum that Dean created is one of the neatest things I have ever seen. Imagine a legal way to allow students with a same goal, direction, and level of motivation to communicate with each other to pick each other up, help each other along, give helpful tips and tricks, and to ultimately pick our economy right back up where it needs to be for all of us.

I love that people from all walks of life, and with different areas of expertise share information, and ideas with each other ultimately picking each other up. Together we will all be better than the sum of all us us added up. That's what this is all about!

I love it!

Such an amazing asset that dean gives us access to. Everyone that participates in this site always teaches me. Even as a coach for Dean, I learn things every time I come in and read what you all have to say. We are all potential team mates in this program, and not competitors. Thanks so much for all of your input.

Happy Investing.

Matt W.

The question that I have is why move the property into an LLC to tap the equity? You can keep the property where it is, most likely in your name, and refinance. The extra step of moving the property to your LLC may cause difficulty in getting a refinance right away.

The refinance loan will most likely be in your own name. After the refinance you could quit claim deed the property to your LLC.

do you mind sharing what services you used for this?

No, most hard money brokers/lenders do not report to credit bureaus.

Thanks everyone
This has been a real helpful thread of comments!
Very very true!
This forum that Dean created is one of the neatest things I have ever seen. Imagine a legal way to allow students with a same goal, direction, and level of motivation to communicate with each other to pick each other up, help each other along, give helpful tips and tricks, and to ultimately pick our economy right back up where it needs to be for all of us.
I love that people from all walks of life, and with different areas of expertise share information, and ideas with each other ultimately picking each other up. Together we will all be better than the sum of all us us added up. That's what this is all about!
Such an amazing asset that dean gives us access to. Everyone that participates in this site always teaches me. Even as a coach for Dean, I learn things every time I come in and read what you all have to say. We are all potential team mates in this program, and not competitors. Thanks so much for all of your input.
Happy Investing.
Matt W.

This vehicle was mentioned a couple times but no real specifics. I have an Individual 401K with Ameritrade that I want to convert to be able to invest in property. Does anyone know exactly what needs to be done to do this? I know there are Attorneys out there that specialize in this but they charge about $1500 to get it going and I don't think there is much to do it.

As Michelle asked. Do I HAVE to set up an LLC first? I want to be able to buy in both Ohio and Florida but would probably set up the LLC in Ohio if I had to have an LLC...I have set up LLC's before. I think they are $125 in Ohio. However, I would like to keep it anonymous so I am trying to figure out who to use as the Registered Agent. I don't want my name or address on the county record and a family member would also be sort of obvious.

I've learned that I (or the LLC.) can keep checkbook control and can set up a checking account pretty much anywhere..which I was going to do Fifth Third but I am just not sure if I have a proper understanding.

It seems the steps might be
1. set up the LLC - who for registered agent
2. open an account at bank. checking account? do banks participate in individual 401k?
3. sell the stocks in my Individual 401k and then transfer the funds after they have settled?

I am not sure all banks understand this vehicle??

I do understand that I cannot use any profits until 59 1/2. Thats ok..i am just tired of the stock market and would like more control over growing my retirement plan.

I would appreciate any advice on specific procedures if anyone knows.

Thanks!

I previously posted a book title that gives very good info on Self Directed IRA's and investing in RE; here it is again:

How to Invest in RE with your IRA & 401k & Pay Little or No Taxes by Hubert Bromma.

The book was published by McGraw - Hill; you should be able to find it at any one of the online bookstores for less than $20 bucks.....or as others have suggested you can consult an attorney for (I think they quoted...) $1500.

Self Directed IRA's & 401k's with check-book control still have to be set up using the services of a Trust Company. A few of them that come to mind are:
1) Entrust http://www.theentrustgroup.com/
2) Sterling Trust http://www.sterling-trust.com/
3) Equity Trust http://www.trustetc.com/
4) Sunwest Trust http://www.sunwesttrust.com/

I would suggest contacting these companies (and others) and ask them for information on Self Directed IRA's and 401k's. They may or may not offer check-book control (i.e. YOU control your own IRA / 401k check-book)....you will have to ask them about that. Understand that even if you control the check-book you just don't go along on your merry little way as you like without any oversight.....that is why the IRS has rules that say it (the Self Directed IRA or 401k) must be administered by a Trust Company. And they will charge a fee for administering your account (even if you control the check-book).

Do your research people; get the book I suggest and read it. It may take you all of 2 days or so....and it certainly costs less than consulting a Tax Attorney; although that might still be a good idea but now you can ask and go in with intelligent questions about how the whole Self Directed thing works.

Good luck everyone and happy investing!

Just learned from an RE Attorney that you (nor any member of your family) cannot LIVE in a property bought by a SDIRA. That is, not until you're 59.5 years old, anyway.