Best Entity for California Residents

[Account Closed]

I'm trying to figure out the best entity for CA resident/investors that want to invest both in and out of state. I know a California LLC is required to pay 800.00 a year annual tax. I am already doing that with one LLC I own for a non REI business.

Are the California investors here using California LLCs, or perhaps Delaware Series or Nevada LLCs instead?

It looks like the Delaware Series is the way to go for multiple properties. But that I'd still have to pay the 800 per year to California because I reside here.

I am currently shopping for a good attorney, too.

~Matt

[Greg Boots]

Joe,

This strategy would certainly work if we were looking to protect liquid assets (stocks, bonds, cds, etc.) that really exist in cyber space. Unlike real estate activity with these other investments there is not a direct connnection with California.

A holding LLC is an excellent option when you are involved in real estate transactions in California. The Calfiornia LLCs are the enitites that are conducting business in California in the State, the Nevada LLC simply holds the membership interest (ownership) of those LLCs and is not doing business in California and thus does not have to file a foreign entity and be subject to the California Franchise Tax.