Pros/ Cons of placing your primary residence under your REI LLC in Virginia

[Sean Timper]

Hey BP Fam, 

I had a thought about what would happen, and would it be worth it, to place my primary residence under my LLC and then charge myself rent to live here. I saw a bit online that stated it could be worth it in some states, but not others.

Has anyone persued this, or been down this path before? 

Thanks in advance. 

Sean

[Ashish Acharya]

Placing your primary residence under your REI LLC offers liability protection and potential tax deductions but comes with significant drawbacks.

You might lose the homestead exemption, face IRS scrutiny, and encounter issues with your mortgage lender or insurance provider. The risks, such as triggering a "due on sale" clause and complicating your taxes, often outweigh the benefits. If you have a net income, you are double taxing the income as rent that you already paid taxes on when you earned it.