Do you need to LLC first?

[Emily Senior]

Hi! My dad and I are looking to get into real estate investing together and are wondering what we need to do before we get started? Mostly we are trying to make sure we don't have to pay a lot of extra taxes that could be avoided if we set everything up correctly to begin with.

Is real estate income (from long term rentals) different than self-employment income? Do we need to set up an LLC and Scorp to do a W2 type salary? We'll talk to an accountant before starting anything, but just currently looking to figure out what direction to go in.

Thanks!