?? to structure split w/ LLC - partner is conractor, I am RE agen
I am a Real Estate agent and my partner is a contractor. we are going to form an LLC to do flipping. I will provide all the downpayment $$ and make the deals with lenders, find the properties as well as market them when they are complete. My partner will do ALL rehab. - demo, to completion.
Here's my question:
If my partner was NOT a contractor I would have to pay regular contracting rates. so..what is fair. he gets discounts on all materials needed which I will be paying for (out of our hard money loan - we will both be on the hook for the loans) if we are splitting the profits after sale 50/50 should he provide labor at a discounted rate - I don't expect him to work for free, but Is it fair to pay him full regular contractor prices and split the profits with him? --- If I hired another contractor and did this without him, I would pay the contractor the going rates and keep ALL profits myself. - so i'm trying to decide how to structure this where its fair for all.
any thoughts? does anyone out there have a similar relationship?
btw, the contractor is also my brother in law, our goal is to keep it all in the family and help each other.
Thanks for your thoughts!!!