LLC/S-corp for single family property and AB1492

[Lidia Marchioni]

Hi all

I'm looking to purchase my first rental property. If the deal goes through, I'm going to move and rent out my single family house located in California. I've been advised in the past to form an LLC and convert it to an S-corp for liability and tax purposes, for rental property ownership. However, as I'm reading about AB1492, I found this piece of information:

"Your single-family home is exempt unless it's owned by a real estate investment trust (REIT), a corporation, or an LLC where one of the members is a corporation." (from https://www.mynd.co/knowledge-...)

Does it mean that if I form an LLC to own the house and convert it to an S-corp, I will not be able to claim it exempt from AB1492? What are the best practices for single family homes rental and ownership in California?

Thanks

Lidia