Pennsylvania Investment property: Trying to cover our bases

[Greg Rose]

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Hello BP community!

I am about to embark on my new property journey.

We live in California and the property we are interested in is in Pennsylvania.

• House is $50k
• Two residential units with each bringing in around $550
• We have $50k in cash and will be buying it outright
• We are creating a Pennsylvania LLC to hold the property
• We are getting a Pennsylvania registered agent (required)
• We will get a landlord/dwelling insurance policy
• We will get a full-service property manager to manage and maintain the property

We tried to think of what else we need. Any thoughts or comments?

Specific questions:

• Has anyone set up an LLC for their property and paid a regular amount monthly to the owners of the LLC? For example, could we pay ourselves a fixed dollar amount from the LLC bank account every month?
• Do we need to form an LLC in California as well as the one in Pennsylvania? From what I have read, we do not. I need to know because we need to open a bank account locally.

Thank you so much for your thoughts and comments.

-GR

[Steve Babiak]

Your LLC will need a federal EIN.

You will want to locate an accountant familiar with filing the PA state LLC annual income tax forms.

The municipality will probably require you to have some kind of rental license, and they usually charge a fee per unit. If it is in Philadelphia, there is a whole lot more you will be required to do to comply with rental regulations there.