Structuring LLC for Dividends

[Abraham Burns]

Hi Everyone!

So here is the situation. Myself, my mother, my in-laws and grandparents are all ready to get into the house flipping business. We all have been involved in the industry for quite sometime and have enough funds to start taking some risks. Our family team is made up of a realtor, a banker/lender, general contractors and a construction supplier. We all have worked with flippers before and are ready to do it ourselves.

What I need help with is structuring the business to pay our profits through dividends.

Here is what I have so far:

We will structure as an LLC with everyone having equal ownership.

We will file to obtain S Corp status to be taxed as a corporation.

We will purchase and renovate homes with cash and profit will be paid through dividends to share holders.

Questions:

Will our LLC need corporate bi-laws?

(We are using legal zoom to form our LLC and operating agreement, is an operating agreement enough?)

What should these bi-laws include?

What is the best way to pay dividends to shareholders?

I am looking for anyone that structures their flips as an LLC with S corp status and pays through dividends. Any advice on how you do it would be great!

- Abe