Forming My First LLC

[Nick Furukawa]

I am looking to purchase my first investment property this summer in Indiana and I am currently looking into forming my LLC in the coming weeks so I can get my business bank account set up and start tracking tax deductions. I was wondering if anyone could give me advice on forming my LLC and what to expect. I was also seeing that it would be best to form your LLC in Nevada or Wyoming and I was wondering if that was true. Also, what is the best way to find a good attorney and what could I expect with pricing for the attorney?

[Michael H.]

Quote from @Shikha Gandhi:

Quote from @Michael H.:

IMO you don't need an LLC unless you have a substantial amount of equity in the property. And even then you can get an umbrella policy to cover your equity. I think trying to run your operation through an LLC at this early point in your journey is just adding unnecessary complications. The upside is minimal (especially if you get an umbrella policy).

I was exactly where you are when I started this about 7 years ago, and wasted a lot of time and effort trying to figure it out. Find a good real estate lawyer in your area and get their opinion. Google is your friend.

Hey Michael, After about how much investment made in real estate personal portfolio do you think it would make sense to run operation via LLC vs personal ?

That's a hard question to answer, probably a personal choice honestly. For me, I have 5 properties and about 1.3m in equity and I feel just fine having an umbrella policy. I also do my own taxes, so not using the LLC just makes my life easier. In the next year or two, when I start using a CPA, I'll probably start utilizing a parent/child LLC structure.