LLC or NOT

[Andrea Shields]

Hello BP,

I have 2 SFR that I own (owned before I got married). I claim these on taxes, my husband and I have never filed taxes together as we both have things that we are sorting out before we can file joint. This does hurt us as we end up paying more taxes and do not get the credits for married couples. my accountant tells me that I loose the tax benefits of owning rental properties because I file separately and should either sell the properties or file joint. He says I will not get these credits until i sell the properties. As of this email, we are again not filing joint returns because of our obligations pre-marriage. I am in the process of purchasing additional properties as I have decided to make this my sole source of income. I currently do not have a "company". Would forming an LLC as I will be expanding my investments be a good way to go, more importantly would this allow me the benefits I am told that I am currently not getting for having rental properties. Thanks

[Ali Boone]

Hi, Andrea! Wow tricky situation. I make all suggestions not as a legal or tax expert of course, so be sure to always check with the proper professionals. But not being able to get your rental property benefits (I assume he means depreciation and write-offs, etc.) doesn't sound right to me at all. Do you know for sure this guy knows his stuff? Have you asked around for a second opinion just to make sure?

As far as an LLC, I wrote an article that may help you. More than just the article, read a lot of the comments. They are extremely informative.

http://www.biggerpockets.com/renewsblog/2013/08/17/rental-properties-llc/

Hope that helps!