How many single family rentals do you keep in one LLC?

[Natalie Stanley]

How many single family rentals do you all keep in one LLC? I have around 100 single family homes in one LLC. I have heard that I should have an LLC for each home but it seems administratively burdensome to have 100 bank accounts and 100 different tax filings, credits cards, checkbooks, etc... Can others please share how they think about liability exposure in an LLC. There are large investment funds with thousands of single family homes, I can't image they have an LLC for each home.

[Benjamin Aaker]

Congratulations on amassing such a large portfolio. This is a great question that gets answered a lot here and you will hear very many different answers. I recommend to have no more than 10 properties or $1 million in an LLC.

The point is to have a sort of firewall between each LLC. If you have a loss (think slip and fall lawsuit) on one of your SFRs now, it is fairly easy to have a verdict that spills over into one of your 99 other properties. An LLC would limit that, though not completely remove it as a possibility.

The LLCs need to be substantially run as their own business. No intermingling funds is one such difference. This will mean a lot more bookkeeping and accounting work for you to switch now. That's why I personally allow 10 properties or 1M. It's a nice balance for me. Remember - it's about limiting your liability. Nothing completely protects you.