Southern New Hampshire Rental LLC

[Mark McDonnell]

New investor here, looking at investing in rental properties in Southern New Hampshire. In the process of setting up an multi-member LLC in New Hampshire where 1 of the members resides, other members are out of state. Looking for guidance in terms of how the whole tax-process will work and other considerations for the early stages of setting up this LLC.

What is the timing of the Form 1065? I have read online it says you ust file Form 1065 no later than 15th day of third month of the year following the table year. So is it correct to take that as we would need to file in March which is ahead of when we would individually file our K-1s? And if that is the case is that because we would need that Form 1065 to get approved before we can accurately account for our individual filings? Or can Form 1065 be done at the same time as the individuals members taxes?

[Troy Zsofka]

@Mark McDonnell - 

I don't know the answer to your first question, but I doubt that would be necessary.

If you own everything under one LLC, you haven't limited your liability a whole lot.

However, the more LLC's you have, the more expenses (annual State registration filing, accountant fees for tax filing, etc).

When I own large multi-families, I will own each under its own LLC. However, for single family homes with NOI's of $7-12K/year, spending an extra several hundred on each one to have it in its own LLC is cost-prohibitive. (Besides, here in NH, you'll need that money to give to the town for the fifth half of your real estate taxes.) By putting several into each LLC, I can reduce those costs while still reducing potential liability by not putting all of my eggs in one basket. Call it a happy medium...

These are my personal opinions, I'm not an attorney or accountant, blah blah blah.

@Tucker McCarthy -

Your NH accountant is giving you legal advice that coincidentally results in more business for him/her. Conflict of interest? Maybe, maybe not. Just a thought...