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Should you change your LLC regularly? Attorney says yes!
I've had an attorney and a CPA tell me I should change my house flipping LLC regularly. Run a dozen or so deals through, then let the LLC dissolve and create another one.
I believe the reasoning was for liability purposes, and the CPA said it was to avoid IRS attention.
It doesn't seem right to me. No other legitimate business does this that I know of. Is anyone else doing this for house flipping?
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@Matthew B., happens in business all the time.
In corporate america, it is not unusual for a fortune 500 company to have 600-700 entities across the globe for various reasons (taxes, regulatory and liability being the main ones).
My "other job" is flipping companies, in a sense, and this structure is common, especially for partnerships with other investors.
Commercial RE ($10MM+) is also conducted in a similar fashion.
In fact, this is the norm outside of individual investing.
You can always get a second opinion from another lawyer and CPA to see if it makes sense for your situation.