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Updated about 16 years ago, 11/25/2008
LLC Members
I have a question for you full time investors,
I am forming a new LLC for rental property and I am wanting to have me and my wife as partners so she can manage the business if I am away.
How does this work, it is asking me for the percentage and the contribution?
I am also wondering if my wife will have to file for her own EIN number, and how does this work out? If I am using the EIN number that I already obtained?
If anyone can help me out that would be great
Thanks in advance for your help
Rick
One LLC, one EIN. Each of you are managing partners and each should have 50% each (of course you can make any % you want, I am assuming you want 50%/50%)
You need an operating agreement, and in that you need to layout exactly who does what, what happens for occurances such as decision making, liquidating, etc. etc.
Consult an attorney on this. I have a good one in TX as I invest there if you would like a referral.
#2 Off Topic Contributor
- Real Estate Investor
- the villages, FL
I have to ask , why are you doing an LLC? Your info and questions make me think you are doing the LLC online and filling in the blanks. An LLC is normally for asset protection and the way you're discussing will bring the wolf right to the owners of the LLC-you and your wife. I suggest you pay the money to get some good advice. Take it a step further than the LLC to be safe, imo.
What step further are you referring to Rich? Land trust?
Not sure why a simple property needs any more than an LLC. In fact, a great insurance policy is more than sufficient.
At any rate, I live in a community state, CA, and my wife owns half of everything regardless if she is named on the LLC or not.
Do take Rich's advice and seek legal guidance. Setting up the proper entity in the proper format is crutial.
Originally posted by nationwidepi:
Not sure why a simple property needs any more than an LLC. In fact, a great insurance policy is more than sufficient.
At any rate, I live in a community state, CA, and my wife owns half of everything regardless if she is named on the LLC or not.
Do take Rich's advice and seek legal guidance. Setting up the proper entity in the proper format is crutial.
I am forming and LLC for asset protection. I was only confused on the issue of members in the LLC. I am just trying to figure out if my wife needs to be on the LLC or not, this way she will have some authority in the business if needed. I understand that I can set all this up in the operating agreement. My other issue was tax purposes, being a single member or a multiple member, I think its best to do a single member and file tax returns as a business instead of a pass through to personal return. I have been in contact with a couple of other landlords that have been in the business for many years that are LLC, and hopefully they will provide some advise.
This LLC was the last step in getting everything setup, so I am just covering myself and making sure it is all correct, before I jump into business.
Thanks for the help
Rick
#2 Off Topic Contributor
- Real Estate Investor
- the villages, FL
I still suggest consulting an attorney. There are other steps you can take that secure more in the way of asset protection, AND also cover estate planning using an irrevocable trust. I'm not an attorney and don't pretend to be. Contact a good one before your estate grows too large.
Having a problem of a "too large" estate is a problem we would all like to have!
Using an attorney and proper tax planning is key as mentioned.