LLP or LLC???

[Pat Bruton]

I am converting a personal residence into a rental and am wondering what would be the benefit of starting an LLC compared to an LLP? The partner would be my wife. I am thinking of possibly the benefits of an LLP being that we can write off meals and entertainment for when we go out to eat and discuss the property and some asset protection being that there is two owners. Thoughts? Am I way off on this? Also, do I need to transfer title into the LLP/LLC or can I just use the entity to manage the rental transactions and still get the personal liability protection? Overall I am mainly interested in the best option for tax purposes and personal protection.

Thanks BP!

[Jeff Robert]

Alabama, may be different, so I speak only of Michigan, although I was pretty sure LLCs work similarly throughout the US. I've never heard of using an LLP, outside of business structures where there are independent partners performing independent tasks (Attorneys, Doctors, etc), where it provides you additional protection between each others actions.

That being said, an LLC should provide everything you need. "writing off meals" is not specific to any entity, you could do so with any business activity, even without an LLC, on your personal Schedule C.