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Updated over 8 years ago on . Most recent reply

Karen Mathieu's profile image
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Karen Mathieu
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  • from Cincinnati, Ohio
  • Member since Sep 30, 2015
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Karen Mathieu
  • Investor
  • from Cincinnati, Ohio
  • Member since Sep 30, 2015
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Karen Mathieu
  • Investor
  • Cincinnati, OH
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Tax, SDIRAs & Cost Segregation

LLC Tax Structure

Karen Mathieu
  • Investor
  • Cincinnati, OH
Posted

My husband and I have formed an LLC for our buy and hold real estate business. We currently have 3 rental properties and hope to grow. Which tax structure would be better for us, a partnership or an S-corp? Thanks!

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Natalie Kolodij
  • Tax Strategist| National Tax Educator| Accepting New Clients
ModeratorReplied

I would keep your 3 properties in the LLC as a disregarded entitity and just report it on your 1040. No real need for an S corp.

Rental income only triggers SE Taxes if you're a real estate professional. If you don't qualify at this point there would be no benefit to paying for filing an S corp return. 

IRS guidelines for a Real Estate Professional

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