Buying Investment Property with llc vs personal mortgage?

[Logan Jamieson]

Hello BP friends!  Can someone clarify for me the pros and cons of purchasing an investment property (which I will live in) with an llc vs a personal home mortgage?  Specifically, tax incentives/ deductions?  

My research seems to show with a personal mortgage I can deduct my mortgage interest, property taxes, and home equity loans or lines of credit for funds to improve the home? How do these tax benefits compare to starting an llc which would purchase the home? I am assuming the LLC mortgage terms would be different(term, down payment, interest rate)? Can I use an LLC on an FHA?

Thanks all for the help. I am frantically trying to lower my tax bracket, beyond hitting the 401 (k)/ IRA limit real estate seems the best way to do so.

- Logan 
 

[Wayne Brooks]

Lots of Disadvantages, No advantages.  If you bought in an llc....no fha/conventional loans, no homestead property tax exemption, no section 121 exemption when you sell.  Buying with llc...you could claim depreciation, but you’d have pay yourself market rent , which is taxable income greater than your depreciation.

Bad idea all the way around.