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Updated almost 8 years ago,
Attorney & CPA giving conflicting advice... help?
Hi BP,
I live in California and I'm forming an LLC with another person (who also lives in California) in order to buy 5-10 rental properties (small multis) this year in Kansas & Ohio.
My CPA is telling me that I should just create LLCs in Kansas & Ohio, and that I don't need to create one in CA - thus saving me the $800/yr fee.
My attorney is telling me that I absolutely need to create one in CA, and that the Franchise Tax Board will penalize me and I will pay more than the $800/yr. And that after I form an LLC in CA, I should just get business licenses in Kansas & Ohio whenever I buy.
It's really weird to hear such conflicting advice, so I'm hoping to hear some first hand experience from other members of BP.
How do you have your entity structured for out-of-state rentals?
Do you just have it where YOU live in, or just where the properties are, or both?
Also, do most people just create their entities over Legalzoom?