Should i form an LLC? What is it?

[Kyle Jenkins]

I am about to move out of my Condo and will be renting it. Should i form an LLC or some other sort of bussiness? Why should I? How do I? Thank you!

[Sarah Ottesen]

@Kyle Jenkins you should definitely consider consulting with an accountant, a lawyer and an insurance agent. my lawyer suggested that I just get really good insurance and wait until I get a handful of properties before starting an LLC. What he meant by "really good insurance" is an umbrella policy. this policy add additional liability insurance to all of your policies. you will want an umbrella policy to be a bit more than your assets. This will cover your properties if you were to become liable for something. An example, you have properties worth $500,000. your auto insurance covers up to $300,000 if you were to cause an accident. The $300,000 would not cover your entire assets, therefore, if sued, a lawyer could see that you have the $300,000, but you also have a $500,000 house and will try to go for the property as well. If you had an umbrella policy that was at least $200,000, it should protect your $500,000 property (300,000+200,000). Again, talk to an insurance agent, they can explain better!