Tax Organization Structure

[Pat Williams]

Where are my blind spots in this tax organization for a real estate developer. A single member LLC (Company X) runs rentals, RE development, and is General Contractor on the development of the properties. The rentals need to move out of this LLC.

Now the Development projects are LLCs taxed as partnerships with the main LLC as the general partner.

1. Is there any way around dealer status for RE Development for this kind of operation (buy land, develop houses, sell to individuals)?

2. Company X is thinking of changing to a Corporation. This would eliminate the dealer status and only leave the taxation of corporations, correct?

3. The partners of the development would need to find their own ways of avoiding dealer status or are they protected since they are limited partners?