LLCs can also be set up as an S-Corporation or a C-Corporation. This might reduce self-employment taxes, but you should talk with a professional to see which setup is best for you. A few things to keep in mind regarding LLCs and real estate: If you set up an LLC after you already own a rental property that has a mortgage, it’s possible that property can’t be part of the LLC. Lenders might think it’s a sale, which would mean you’d have to pay whatever’s left on your mortgage. Other possibilities are losing a low interest rate or maybe even losing your mortgage altogether. This doesn’t mean any of these things will happen, but it shows why it’s so important to know the requirements ahead of time! Second, you should never use your LLC money to pay for something personal or your personal money to pay for something business-related. If you ever get sued, this would be discovered, and the opposing lawyer would point out that your LLC isn’t a separate entity (and win), meaning you’d lose all the protection that a valid LLC provides. Richard Davis www.InvestmentRealty.US or www.Florida.cc KeystonePennsylvania@gmail.com or RickDavis@Florida.cc Office (844) 227-6700 Cell (717) 778-7309 l (717) 778-7309
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