311. LLC Myth-Busters: Is Your Real Estate Really Protected?
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Feb 7, 2025
Dive into the world of LLCs as misconceptions are shattered! Discover the real purpose behind LLCs, focusing on asset protection rather than just tax savings. Learn about the optimal structures for your rental portfolio, including single and multi-member setups. Avoid common pitfalls that could threaten your investments. Plus, gain insights on holding companies, and the importance of keeping personal and business finances apart. Stay informed and protect your real estate assets like a pro!
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insights INSIGHT
LLC Purpose
LLCs are primarily for asset protection, not tax purposes.
They protect against lawsuits and liabilities.
volunteer_activism ADVICE
Avoid S-Corps for Rentals
Avoid S-Corps for rental properties due to potential tax implications upon property removal.
Moving appreciated property out of an S-Corp can trigger substantial capital gains and depreciation recapture taxes.
volunteer_activism ADVICE
Recommended LLC Structure
Consider a tiered structure: property-specific LLCs, a holding company (often in Wyoming), and a revocable living trust.
This structure is commonly recommended by attorneys and provides additional legal protection and estate planning benefits.
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In this episode, Ryan and Thomas pull back the curtain on LLCs, busting the biggest myths that trip up real estate investors—and revealing how to truly protect your rental portfolio.
They discuss:
- Asset Protection vs. Tax Savings—understanding what LLCs really do (and don’t do).
- The Right Structure—single-member, multi-member, or holding company?
- Pitfalls to Avoid—from the “due on sale” clause to S corp mix-ups.
- And more!
If you’re eager to make sure your LLC is set up the right way—or wondering if you even need one—this episode is for you. Tune in and discover how to keep your real estate assets safe and sound.
To become a client, request a consultation from Hall CPA, PLLC at go.therealestatecpa.com/3KSEev6
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