LLC Benefits

The Tax Club offers a FREE half hour consultation about LLC's and Corporations if you are enrolled in the coaching program / success academy. They are an accounting company and make money if you get a business set up with them.

The half hour consultation is worthwhile because it is FREE and they will review your goals and business plan with you. Based upon this they will give you advice on the business entity to set up and even the state to pick. They most commonly will choose NV because of the benefits but they have also suggested WY and MD. Once you have gotten the business entity and state to pick you can actually take that information to you CPA, attorney or still work with the Tax Club to set up your business.

Keep in mind also that the Tax Club is ONE way to get a business entity. You can also use your accountant, CPA, lawyer, or even braze it on your own. The Tax Club is given as AN option because of their knowledge of accounting and tax benefits for real estate investing.

A corporation is the way to go. With a corporation, you're able to get large lines of credit, plus you get huge tax benefits.

I don't have business name yet...or account...or anything for that matter...no money...no credit...no job. But I want to buy a house and resell it to an investor. Is that possible. I was thinking of doing one of them assignment contracts or resale agreements and putting a low down for the transfer (like $100).. is this something correct? I'm totally inexperienced. Can you give me some advice on this

Here is another post that should answer your question:

http://www.deangraziosi.com/node/1509

I am new to REI. I just wanted to tell you all that your comments have been invaluable to me. I have learned everything I know about RE over the course of the past 3 weeks. I have a lot to learn. So much so that I don't even know what questions to ask yet. But some of you are asking those questions I need to know. Thanks. I will jump in there soon as I get my feet wet. By the way, I have already set up a corporation which sounds like it may have been a bit too soon. However, I plan to jump right in there so hopefully, it will pay off.

Renee

Starting to early is never early enough. Ive read these post and notice you dont need a llc yet but i also read that you need to build credit towards your llc. If you start now building credit towards your llc youll be well established by the time you need it...just a thought

We secured an llc in nevada that can be used as a series llc, not sure if we secured it the right way, but it is there and we pay a monthly fee regardless if we use it or not. Since we have not bought any properties yet we look forward to any and all comments on LLCs for real estate and uses.
thanks

The info you just gave to me is very valueable and i appreciate it. I hope its not too much to ask you to be my mentor i have a burning passion to learn as much i as i can i all i need is some who has traveled this road before to guide me so i could know what to expect so only with your permission i would like to stay in contact, so if i have a questions i could ask you.

After reading a number of books on the subject we decided the LLC was the way we wanted to go. In California the LLC costs $800 per year and files it's own tax returns. You can not get a loan directly through the LLC unless the company its self can prove that it has enough income to qualify for the loan. As one of the other posts says you must transfer title through a trust deed to the LLC. be careful of the "due upon sale" clause with your lender when you transfer title. Personally when we get to that point we are going to have a real estate attorney review everything first. If your LLC goes under you, as the owner are still responsible for the debt. I have had many people tell me that the LLC is not what I wanted to do during my research stages because they thought I wanted to try to hide from the responsibilities of my company. Not the case, I want the asset protection. Legalzoom.com is a great website that will easily take you step by step through the whole process. I hope I was at least a little help to you. Good luck.

Eric

This is very similar to what Nathan Street, one of the coaches from Dean's RE Success Academy, went over the live EDGE event. Basically open a business account under your LLC name,at three local banks. Get a loan from Bank1 under your LLC, and open an account on Bank2. Get a loan from Bank2 and do the same with Bank3. Then go back to Bank1 and pay the loan. And ask for a new one. You will use this to pay Bank2. repeat the process with Bank3. Every time you open aline of credit and pay it, you will be scoring high under your LLC credit score.

As Anita mentioned on a previous post, Brad&Streent will provide you the DUNS number. This is the number used to report on the credit for your corporation.

Be Blessed

Hello everyone!!!!!!!!
The Entity to choose?
WOW!!!!!!! I got all my answers, TTTTTTTTThhhhhhhaaaaaaannnnnnnkkkkkkksssssss!!!

Im new to this site BUT not to the Dean Graziosi family!!!!! Been on&off following since "Motor Millions", then came "Think a little Different",the websites, have all the books, Im now registered here & at "Total View", where I`ll be posting some props for sale. Just recently started looking at Real Estate as a biz & working to step it up to the next level.
Looking forward to Networking w/everyone, creating win-win situations and having fun while doing it.

To Your Continued Success,
Carlo@RighteousRealEstate.com

In the beginning, it is not essential to have an LLC, however, it does offer a lot of benefits. For instance, you can maximize your tax deductions when you have an LLC. You can use it to put a proeprty under contract and then sell the LLC or Trust to another party. It is a great way to avoid assignment of contract and seasoning issues. You will benefit from using LLC's or Trusts to reduce your chances of being pegged as a dealer. You don't want to be pegged as a dealer personally, because then you would loose your tax advantages of owning your own home.

You can build corporate credit for your LLC and Trust and then approach lenders for loans in that entities name. While you are building your corporate credit, you have to make sure that any creditors you work with report to Dunn & Bradstreet, so you can build up your paydex score. 80 is a good number to shoot for. One place to start is with the bank you have your business checking account with and then move onto gas cards, office supply store cards, cell phone provider accounts, and many other vendor accounts. As long as you use, pay down your cards, and pay on time, you will be able to build corporate credit.

The greatest benefit is that your business can have access to more lines of credit then you personally can.

I just finished reading Dean's book profit from real estate now. what a great book. Does anyone have an idea on how I should start, my credit is hurt due to a foreclosure last year. I belive anything is possible so I am not counting myself out the game. What would be the best way to get started since my personal credit is severly damaged! I would appreciate any thoughts.

I just opened an LLC in the state of AZ, How did you do a series LLC? Is there much difference?

Rohn,

Looks like you're going strong and have taken the same path I would like to take. Can you explain more about the Hard Money lenders and how that whole thing works?

I formed a Corp in NV and like it. You hold all the offices and pay no state income tax even if you live outside of Nevada. Very smart! Email me if you want some onfo/ I can put you in contact with the people that I worked with easily.

Don, Las vegas

Thats a great idea. Complete separation of your business from personal finances. Could you tell us readers where to get the LLC which stands for Limited Liability Corporation. Is that right. I know we can get it from the county..am not sure..dom

Just starting out. Is it really necessary to obtain an LLC? And if so, why?

Where do I go to find out about all the papers I need to file, how did you know how to create these 2 documents? ANY help would be appreciated, I'm a new REI also, overwhelmed to say the least. Want to protect myself, have my business make the money, but not sure how to go about all the documents. Attorney's sure can make the bucks when we're ignorant. Thanks for any tips, I NEED help.

Hope that's OK with you. Thank you, I'm looking into the website business, AND the EIN & LLC paperwork.

Sheesh, that's crazy high prices for an LLC. I better look into CO, I think it's much less...I HOPE so at least. Thanks for sharing. I thought the REPLIES followed the comment I was replying to, but it sticks my REPLY at the END of all the comments, soooooo, my comments don't make sense. Oh well, live and learn. And I AM learning, thank you all so much for your responses to our questions as new REI's.

It not necessary at all to start an LLC. It is very beneficial though. Having a business entity such as an LLC will give you protection from a law suit and will help you write off more on your taxes.

If someone slips and falls on your property they will sue the business if the property is owned / deeded to the business.

Also, we make a lot of money as investors. We get hit with a lot of taxes. The government allows us to lesson this through businesses. You can write off more in your taxes if you are a business vs. doing it on your own.

I am new to R.E. investment, however, I have an investment property under an LLC and would like to know what's the procedure for putting the property under a Trust with the LLC being the benficiary.

should there be some sort of contract involvled in a partnership? If so what is it called and where can I find it?

I already have a Sub S Corporation that I established to start another business. Everywhere I read in these posts all I see are LLC's. Is there a specific reason to use the LLC form of incorporation? I was planning on setting up another company name as a DBA (Doing Business As) under my present corporation. I could use some advice before I proceed.

That's good advice for establishing credit on my LLC,, thanks. I'm am up and coming REI and I need all the help I can get.

You will most likely have something similar to the articles of incorporation as well as a partnership agreement.

You can find partnership agreements online. Be careful that you read the agreement fully or you may get some quick surprises after signing.

I suggest if at all possible that you have an attorney draw up the partnership agreement for you. They are professionals at doing this type of contract and can help pinpoint items that you may have not considered. They are looking out for your best interest where if you get a contract from the internet you do not know who is fully the protected party.

I'm a little confused about the LLC protecting my assets. If everything is put in the name of the LLC, then all those properties can be lost, if I lose a lawsuit, correct? Wouldn't it make sense to put half in my name, and half in the LLC? or if I get personally sewed, is the LLC also at stake because I own it?

I'm so confused.

LLCs are a good business strategy tool once
you have a good handle on what your strategy is
and what you want to use it for. Keep in mind for
when you are ready to use it for your business.

Hope that helps a little....