Any advantage to sole proprietorship for rental
I just bought my first rental home and will be using a property manager. I wanted to understand whether there is any advantage to creating a sole proprietorship. I can could use this to open a business account at my bank for managing the income and expenses, otherwise I can open a new personal account just for the rental. I'll most likely start an LLC next year after I have a few more properties and will need to move any properties I have into that LLC. Thanks!
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Well, that's kind of like running the car out of gas and having it towed back to the station you passed before the engine stopped. Things are a bit out of sequence.
You should be buying properties in the LLC so you don't have to deal with the Due on Sale questions when you go to deed the properties into your LLC.
I know - "everyone" does it the way you've started, or so they claim.
Remember also that a Sole Proprietorship is just you "doing business as" the Sole Prop. There is no liability isolation, etc. You also cannot "move" the Sole Prop.'s EIN to a new entity.
Maybe better to start out with at least one LLC, though you should build a proper business entity structure with a revocable trust at the "root" to replace you as owner of the entities, then an S-Corp owned by the trust as your operating company, THEN an LLC owned by the trust and the S-Corp to hold property. That way, no entity is owned by any human person. Everything must still be properly insured, of course.