Accredited Single Member LLC Pass-through Investment

[Cindy Cabrera]

This is my very first post, but hopefully it makes sense:

So I have a few investors interested in investing in multifamily. Unfortunately only one is technically defined as an accredited investor. All others are interested, but are not accredited investors. As a group, we were thinking of investing through an LLC owned by the single member that is considered an accredited investor. This way, all investors can still invest in a 506(c) deal if they put their funds into the LLC account which would invest in a 506(c) deal that was only for accredited investors.

The LLC was formed in California and all but one investor are living in California. Please share if you know more info on this. Concerns are how the LLC and all investors will be taxed and if all investors will be able to use the deal as a tax-write off if the deal invests in a property that has a high cost-segregation deduction on their first year for example.

Feel free to share any info!