seperate LLC?

[ryanpal]

hey guys. i have a home under contract for my one llc which i’m doing short sale flips with. i’ve read some people suggesting to put each property under a different llc.

two questions.

1. what are the benefits to having each property under a differnet llc? doesn’t this add for alot more paperwork and make things more complicated?
2. if i purchase under my current llc, create a new one and deed it over…is that a simple process and are there any drawbacks?

thanks in advance.

[propertymanager]

If you’re going to be in the rental business, it would be nearly impossible to have a separate LLC for each property. Could you imagine having 100 checking accounts, 100 tax returns, etc? Not me. I have my properties divided into LLCs according to risk. I generally have 10 to 12 rentals in each LLC.

Good Luck,

Mike

[BLL11]

@ryanpal post:1

1. what are the benefits to having each property under a differnet llc? doesn’t this add for alot more paperwork and make things more complicated?

There isn’t one. You can accomplish the same thing with better protection using other methods that are much more simple and have fewer maintenance requirements. I only use separate LLC when the members or management will be different.

@ryanpal post:1

2. if i purchase under my current llc, create a new one and deed it over…is that a simple process and are there any drawbacks?

It’s a bad idea if you state has transfer taxes as you will get whacked twice. There is also fraudulent transfer concerns when you transfer assets for less than fair market value.

[herbster]

From a flipping stand point put each property under a seperate LLC and sell the LLC at closing. Herbster

[moellerryan]

Ideally you put each property under it’s own LLC. That becomes an administrative nightmere however but if you get sued on one property they can only come after what is in the LLC. I recommend doing the first 3 into seperate LLCs, then 2 properties in all 3 LLCs, 3/4/5 properties in each LLC. Make sense?