LLC Benefits

Hello everyone I am starting up my buisness and the name I picked out was being used ( Follow Your Dream )Does anybody have any ideas I could use

Drake, if you read back all thru this thread about 200+ entries it will give you all the info you need. Yes, you can get your LLC and build your business credit...several have posted here about doing that. Start out with a business secured credit card that reports to DNB.

David, Sorry to hear that Follow Your Dream was taking...but that was a given. lol Have you come up with anything else yet? How about Vision Investments, LLC or Vision Enterprises, LLC? Vision is a version of dream so it still states your mission.

Let me know how you two are doing. Have a great night.

Lisa Baker
Affluent Enterprises, LLC

I am new to the site and to the DG Family as well. Firstly, just want to thank you all for your willingness to share and help, it is a great blessing to part apart of such a group. I Live in Cali & own 2 4 Unit rental properties in Tennessee. Should I set up a Land Trust for each and put them into an LLC or is an S Corp the best route to take? as I plan to buy more rentals in the near future. Please advise?

Thank you in advance.

Tony J

**** Psalms 27:1 ****
"The Lord is my light and my salvation; whom shall I fear? the Lord is the strength of my life; of whom shall I be afraid?

Hey DeJor, who did you use to setup for LLC?

thanks for the info.

"However, you must keep in mind that in order for an entity to give you the protection you need, it must be set up and operated properly, and the type of entity or entities must fit your particular situation."

It cost about $80 to set up your own LLC in California and is easy to do. What is not easy is operating it correctly. You need to follow very specific instructions in order for your new LLC to stand up to a judge if it comes down to that. If a judge finds that you have not been operating it correctly you will loose any protection you THOUGHT you had.

It is a confusing subject and I work for an accountant and get free advise whenever I wish. I understand that there is a tipping point fincially where it is in your best interests to form a corporation or partnership.

This is an important issue and I personally plan on waiting until I reach $75K in profit (should be soon woohoo!) and then meet with a real estate attourney and or real estate accountant. I love my accountants but really thing that a specialists is warranted on something so important.

The LLC is a fabulous structure...It combines the best
elements of the corporation without the pitfalls...and
combines the powerful elements of a contractual trust.

One of the best states to form an LLC in is Nevada.
There is not state tax and you only have to record
one name on the state records...The other names become
private.

If you're not skilled at putting together
an LLC, you can expect to pay anywhere from
$550 on the low side to $5,000 + on the high
side should you use choose to employ an attorney.

Here's a TIP...

You may even want to approach a paralegal, since
they typically do all the paper work for an attorney
and know the forms and process inside and out. Plus
you can contract them on a moonlight basis and save
big time. You can also ask them who they recommend for
a local resident agent.

LLCs require and initial filling fee and a resident agent fee.
These are due annually and there are penalties should you miss
your due date. You can also request 24 hour processing
for a fee.

In additional, members of an LLC can also be an existing
corporation, LLC, Partnership, trust, etc.

Since we are not allowed to promote outside services
on this forum, I suggest you run a search in Google...
'Nevada LLC services'. Most local companies in Nevada
will not only do the paper work but will also recommend
a local resident agent...Most companies who provide such
services are also the local resident agent. You may be
wise to seek legal counsel prior to moving forward...
30 minutes of an attorney's time who specializes
in LLCs just may save you thousands in heart aches.

You can also go to the Nevada Secretary of State web site
and click on their LLC link for more information, the necessary
forms , and more. http://www.nvsos.gov/

LLCs can be very powerful and even more powerful when
structured correctly internally and externally with
other entities.

Have fun...And do your homework!

Yes, you are correct...

Using a separate asset protection trust (Land Trust) per
property is a wise choice indeed when it comes to judgment
proofing and asset protection. It’s less expensive than
the LLC and is very versatile….But it must be managed
correctly.

It's true, as the appointed First-Trustee-In-Trust
your name would go on the deed, but it would read
something like this...

'Joe Investor, Trustee-In-Trust in favor of the ABC
Land Trust and it’s Beneficiaries'.

You are simply the appointed fiduciary with full fiduciary
responsibility on behalf and in favor of the trust agreement
and trust beneficiaries. You own nothing...and control everything...
This is the KEY!

There is much to be said about this structure and not enough
room to express it all here...

Since each property sits in its own Trust in the form of
a Trust Agreement you automatically protect yourself
from losing everything in a law suit should one come
you way.

The airlines do this as well...Each plane is in its own entity
which breaks the chain group of ownership.

Could you imagine how fast the airline would fall if all the
planes were in one structure and they had one crash...They would
lose everything through suit. This is the power of using a trust
agreement...it protects each plane individually and contains
the suit to the one plane at fault.

There are many trust structures out there...Some that are weak
and others that are impenetrable. But this too is a discussion
for another time. Not all attorneys are educated in the impenetrable
trusts....So beware fellow investor! Some attorneys just want to
sell you a bill of goods they pull from their stock product shelf.

What's most IMPORTANT is this...

You must NEVER EVER be both the Creator and the Appointed
Trustee-In-Trust. And the Creator must NOT be related in
marriage or in blood in anyway whatsoever to the appointed
Trustees-In-Trust.

And you must NEVER EVER be both the Creator and beneficiary
or the Trustee-In-Trust and the Beneficiary.

If you make any of these mistakes, you will be managing
a sham association that will be viewed by the IRS as
merely an alter ego and viewed as if it were you.

So beware fellow investor...Do it right or don't do it at all.

The last thing you want is for your house of cards to come
crumbling down after all your hard work.

Have fuin!

I just joined today, and although I have heard lots about LLCs having done a couple of business law classes in college, I still learned a lot from the postings. I spent about an hour reading through, the posts - don't think I got done and will re-visit for sure.
Just wanted to add a site I found through smartbriefs. Here is the link:

http://www.quicksprout.com/2010/03/31/beginners-guide-to-corporate-entit...

Rgds
Ruth

Sorry, I'm new to this forum, however Amen to that statment!

P.S. Who is DH ?

Hello! I am a brand new member to the DG family. I'm very excited about getting started. I'm even more so enjoying reading everything I can on the website as well as learning more about LLCs. I must say that I am very grateful to the Lord for bringing Dean into my life! And I truly appreciate having a supportive 'new family' to help guide me in my REI journey. In saying all of that I do have a question? I would like to know how I would go about taking my personal residence out of my name and putting it into an LLC and/or Land Trust? I eventually would like to take the necessary steps to make this possible.

Thanks Everyone!

CeeCee2525

who are these companies that help establish an llc?

IS ANYONE FROM ILLINOIS AND HAS FILED A LLC? AND ALSO, IS EIN FOR THE LLC. IN OTHER WORDS, I WOULDN'T NEED A SOLE PROPRITOR BUSINESS NUMBER FOR THE STATE IF I'M LIST AS A LLC?

can i use INC?

I do not understand what the LLC protects me from. If I need such protection, likely because I do not have a clue what I'm doing(!), then staying away might be better for me!

That said, I DID start an LLC, along with associated Tax Services, web site at Go-Daddy, and other expenses. I've gone broke and do not have income to pay for invest or pay for LLC - which has now gone under.

So, do I have to have one? For bird-dogging, prob not. And that is all I can do now, so the question might be moot at this point. But still, what does it protect me from? (Maybe there is a weblink to a page that explains it . . .?)

Thanks,
Dave

As I suspected, my priority should be to actually find out the difference between a good deal, a great deal, and as Dean says "an Insane Deal" Could use some help here, y'all. Will appreciate your comments. Semper FI D-LO

Do you have to have an LLC for each State you buy real estate in? Can my son (who lives in Illinois) participate in an LLC that I establish here in Florida
where I reside?? My head is spinning but thank you all for your input.

OOOps!! forgot to close with Semper FI!! (VERY important for y'all!!) D-LO

Hello is it necessary to get llc when you first start out?

Hi,
I'm a new REI and just formed an LLC in the state of Washington. I'm planning to concentrate on fast cash deals as a first step.
Can anyone shed some light on what taxes are normaly due by an LLC?
General IRS requirements? B&O tax? Sales tax? - I assume no sales tax are required...
Doing business in wholesale RE area such as assignments?
What if down the road my strategy changes and I buy properties, keep and rent? Does this make a difference as far as taxes?
Is there any official source of information I can read more about it (before I pay an ccountant )? Thanks.

Go Nathan! Right on! Thank you!

Some web sites with LLC information for Florida - NOT endorsing any attorney group- this is for easy access to online state information and entity comparison. http://www.floridallclaw.com/

Here is some information on incorporating in Nevada or Delaware(corporate haven states) in http://en.wikipedia.org/wiki/Nevada_corporation like Donald Trumph and other multimillionaires do. Then you do have to have someone act as registered agent with address there. However, you are the managing director -or whatever you decide and also register in the state in which you reside and work as a foreign entity doing business in your state.

YES- you can use standard forms- available ONLINE FROM YOUR STATE OFFICE SITE FOR SECRETARY OF STATE AS A RULE. Fill out the stock forms- pay the fee- voila- you are incorporated as whatever you chose.

Also- in real estate industry we use something called E&O insurance- Errors and Omissions Insurance. It may be an alternative to incorporation. This is a site for E&O and SMALL BUSINESS FINANCE SITE - featured in Forbes, MSNBC, Wall Street Journal, Business Week - again I am not advocating any site- this is for information you can understand and resources.
http://www.ibank.com/real-estate-errors-and-omissions-insurance/

Florida Realtor since 1982 - Florida laws are among the top 3 hardest in the USA for real estate. Hope this helps someone!

God Bless -
ademarco1

Hello,

I investigated the most cost effective & reliable means of setting up an LLC about a year ago. In my case I decided to use Legal Zoom. When all was said and done it cost me a total of $803.00. There are a number of expenses such as who will be your registered agent, obtaining your EIN (yes,I know you can do it for free yourself), paying your respective state for the actual filing of the entity, etc.

Bottom line is that seldom am I ever impressed with the results of paying for most services. Legal Zoom is the EXCEPTION! They were so on top of everything from start to finish that it impressed the heck out of me. From start to finish I believe it took about 7 business days for me to receive everything at which point that very day I set up a checking account.

Hope this helps .. good luck.

Best,

Ralph

Thank you for this information! We're just getting started (on a shoestring budget), but wanted the protection of an LLC. DS

An LLC is the best way to protect your personal assest. If someone would file a law suit against your LLC, and if in fact you lost the suit, your personal assets, such as your home, bank accounts, etc would be protected from this lawsuit. Assets listed in the LLC could and would be considered as payment in the settlement of the lawsuit.
For each and every property that I have purchased in the past and in the future, I establish a separate LLC for each property. This works well and protects all other properties or cash that I may have in the LLC in all other properties.
As an example: If I own 10 properties, I will establish an LLC for each property. Granted, it may be extra expense, but the money spent makes me sleep very good at night.

Great advice to work towards!

"Now if I had my REI house and my personal house in an LLC, they cant touch
them!

Millionairs have NOTHING in their own name.

OWN NOTHING, CONTROL EVERYTHING!"

Thanks Hazco Investments for your advice!

Valerie in AZ

Hi and Thank you for your time.

Though I still have my 2006 good-faith, estimate for $278,000.k property-
Since then my credit has suffered. (Needless to say - I was advised to rent for a while and by-pass the property the $278.k property - that recently short saled for $150.).

My personal credit is now being repaired - with the help of my attorney.

***My goal is to get to where I can Buy and hold. Because of my strained credit - thought I would:
1)Work on some Assignment of Contracts and save -say $30,000.
2)Start and LLC and build credit through the LLC.
3)After 6 months - go for a business line of say - $70,000. using my LLC.
3) With the $70,000. and a saved amount of $30,000. I would then get a first property and spring into REI.

***Would appreciate any advice!

Thank you!

MeIn-AZ

Hi,

I did set up my series a couple of months ago. You will need to contact a real estate attorney in Alaska to ask if they do Series LLC there. They should provide you with this info over the phone for free. If you don't have an attorney just look in the book and make some calls.
The Series can hold up to 100+ properties. They are held under the one Series name (you choose it) with each property getting a numeric or alpha assigned to it. This will protect you in the event of getting sued. The person suing can ONLY get that one property as the others are untouchable. Hope this helps to clarify a bit for you.
Good luck
Angie

This was a good read.

For some reason i'm getting a ton of info purched the edge 2010 watched that and got the sfl system and still i'm at a stand still. I guess i'm not sure what my first step should be. One thing i do know that if i do nothing nothing will happen. I guess i might be a little scared