Partnership through LLC

[Marlon C. Belfon]

I am considering creating an investment group with possibly 8 to 10 members for the purpose of real estate investing. Had a few questions if anyone can help me. First, is it beneficial to create an LLC with the 8-10 members and purchase properties through the LLC? Second, how would the titling of the properties be, would it be assigned to the entity that is formed? Lastly, what are some of the tax ramifications if anyone experienced creating an investment group? If there is an approach that is more effective, please advise.

[Basit Siddiqi]

@Eric Telese

I normally go the investing route without the LLC. I choose to use an umbrella insurance coverage.

however, I think it is important to create an entity structure when you invest with others; in your case one partner.

Many people will argue the LLC is a better alternative to a general partnership, limited partnership, and LLP when investing in real estate. Ultimately, you should check in with your attorney/cpa for guidance based on your specific case.

There are costs(disadvantage?) associated with having an LLC.
1) Formation costs
2) annual fees for upkeep
3) possible additional fees to accountant
4) possible fees to registered agent(if required)
etc