Main Street Business #577 Which LLC is Right for Your Business
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May 13, 2025 Dive into the world of LLCs where entrepreneurs learn about the six structures crucial for business success. Discover the perks of single-member LLCs, especially for rental properties. Understand how multiple LLCs can enhance asset protection and tax savings. Explore unique options like Series LLCs and COPE strategies for significant equity holders. Unpack the benefits of structuring for real estate and how to navigate the complexities of compliance for licensed professions. This journey promises practical insights to maximize your financial growth!
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Early LLC Setup for Rentals
- Set up a single-member LLC early for each rental property to protect personal assets from tenant lawsuits.
- Consider multiple LLCs if properties hold significant equity to reduce risk on combined assets.
Set LLC in Property State
- Always set up rental property LLCs in the state where the property is located.
- This ensures state court recognizes the LLC and enforces liability protection properly.
S Corp Tax Savings Explained
- Converting an LLC to be taxed as an S corporation saves self-employment taxes when net income exceeds $50,000.
- Taking a reasonable salary plus dividends enables significant tax savings without IRS audit risk.