Business entity for one rental?

[Shaun R.]

As I'm closing in on my first rental property, it occurred to me that any rent checks are going to be written out to my name since I'm managing the property.  I haven't been in any hurry to set up a business entity since I'm just getting started and will only have one rental property.  

Is there any good reason not to have tenants write a check to me for rent, or is it necessary to have a business entity set up?  Do you think a tenant will be more likely to try and bend the rules if they are obviously dealing with an individual instead of a company?

[Bradford Myatt]

Totally based on your goals.  Forming a formal business entity may be wise if you plan on building a larger portfolio.  If you plan on having just one property it may not be necessary.  Just make sure you have a stable umbrella insurance policy, probably$1M.