Order of Operations Converting Primary House Into Rental

[David Abbott]

My wife and I are about to move from SC to NC and have decided we want to try using our existing house as a rental property. I've spent plenty of time researching cashflow implications and tax changes to confirm we will still be profitable. I'm now at the point of needing to take action and I'm struggling to determine the correct order of operations.

From a tactical standpoint, here are the items I need to do in the order (I think) they should be done:

* Form an LLC within SC (I considered NC but then you have to make a foreign LLC registration). Need to establish a local registered agent.

* Write an operating agreement for the LLC as a single member

* Once the LLC is formed, open a business bank account for the LLC

* Transfer the SC property over to the LLC (not sure how to do this yet)

* Contact the assessor office in my county to notify them of the change to an investment property to modify the tax code

* Inform my lender that I'm transferring the mortgage to the LLC. Sounds like I need to sign a warranty deed for this

* Inform my property insurance of the change so I have better coverage for rental incidentals

* Sign with a property management company

* Register the investment property with the city and list the property management company as the first point of contact (city rule is the POC has to be within 30 miles of the property)

Please let me know if I'm missing things or if items are out of order. I haven't found a succinct checklist yet for converting a primary home so if you have one handy I'd love to see it. Thanks for the all the input. 

[David Abbott]

Thanks for the reply Rob! Unfortunately SC is notorious for implementing a much higher tax on rental properties. You can expect to pay 3-4x in tax. Take table 1.2 as an example: https://www.lincolninst.edu/si... 

What's the purpose of the LLC if the property and subsequent equity isn't protected under that company? I'm new at this but my understanding was your either get an LLC or go through the umbrella insurance policy.

As for your property management company note, it sounds like I should bring that closer to the top of my list to accomplish. Thanks!