FHA + Short Term Rental + LLC possible?

[Luis Capriles]

Hi there, I am looking for my first House Hacking investment and planning to use an FHA loan, I am currently located in Chicago, IL.

Question 1: Can I apply for FHA under my name, live in one unit and then, rent the other units as a long-term to my LLC that will legally sublease as STR (AirBnB) ?

I know that I cannot get and FHA with an LLC.

The idea of the LLC is 1) Tax benefits 2) Protect myself from liabilities.

Question 2: Can I combine FHA + IHDA program? I am trying to minimize the down payment as much as possible.

Thanks for your help!

Luis

[Matt Devincenzo]

I think you misunderstand the idea of 'tax advantages'...

1)the protection of assets...in theory an LLC does this, but that has nothing to do with taxes. As a single member entity it is questionable what protection you may actually have anyway since any decision you personally make could still be an opportunity for you personally to be liable.

2) pass-through taxation...this means that the tax treatment is the same for your LLC as you personally. All the income/expenses are passed through.

3) deducting business expenses...you can always deduct business expenses. An expense meeting the qualification for being legitimate allows it to be deducted regardless of the LLC or individual entity involved.