Massachusetts Rental Business Structure

[Nick Snow]

Hello BP Community!

A partner and I have 1 property/3 doors under our belt starting out, with a goal of acquiring another property by the end of the year. I wanted to ask how folks structure their rental businesses in terms of using Trusts, LLCs, the various layers, etc both from a liability and tax perspective.

Our real estate attorney has recommended that given Massachusetts has a $500 yearly LLC fee, that each property be held in its own trust. In talking to a CPA, they will charge $500 per Trust for generating the necessary 1041 and K1s for each trust. This doesn't seem like it will scale well and will cost us unnecessarily.

What are other people doing to optimize their liability and tax structure on your Massachusetts rentals?