What is the right structure for someone starting to make deals?

[Tristan S.]

Hello,

I am a beginner investor, recently closed on my first wholesale deal. Now that I am starting to generate income from real estate, I want to know what would be the best way to structure my business. I am located in Houston, Texas and my goal is primarily to acquire rentals while wholesaling some deals along the way.

I do not have any LLC or anything set up yet. What basic investment structure would you recommend from your personal experience?
I was thinking about two LLC's, one for acquisition (the rentals would be under that LLC name, and I would also use that LLC to do my wholesale deals) and a second LLC that would act as the property management company for the rentals (hold the rent money, pay expenses..etc).

Please let me know what are you thoughts.

Thanks

[David Dachtera]

@Tristan S.,

Ask your CPA about this structure...

Set up a trust with you as the beneficiary.

Set up an S-Corp to be your operating company. Most of the cash will flow through the S-Corp. The trust owns the S-Corp.

Set up an LLC to hold your first couple or few properties. The S-Corp and the trust own the LLC.

This way, you "control everything, own nothing".

If (s)he chokes on it, I can refer you to someone who can handle it (JD/CPA Tax Attorney / Accountant).