Air BnB house hacking should I have an LLC

[Mike Cichy]

Hello, I am new on BiggerPockets and excited to get your feedback.

I finishing my basement to one bath, one bed, and a living room with kitchenette, that leads into a deck and shares my mountain view.

I am sure I can get around $100/night at my location close to Asheville.

Enough rambling around here is my question:

Is there a way I can lease the space into an LLC and rent it out of my LLC?

I want to create legal protection for my home and not have to claim the income as primary income.

What are your thoughts? 

[Chris Baber]

I suggest you speak to a real estate attorney to get a clearer picture for your specific situation.  I am NOT an attorney!

With that said, I think creating an LLC to actually own the house is a great idea.  It should protect you personally from liability from having strangers use the property, and maybe falling off your deck, or other issues.  I believe the correct structure you will want will be for your LLC to own the property, then lease it to a separate management company (probably a corporation), which you could also own, then that management company will rent part of the house on Airbnb, VRBO, etc, and also rent the other part of the house to you, personally, on a long-term lease.

This type of structure will allow you to transfer income as necessary to take advantage of tax laws, and also protect you personally from potential liability.

search for "Clint Coons vacation rental" and follow the rabbit hole on liability protection.  Search "toby mathis vacation rental" for information on tax strategies.

Get professional help with setting this all up; from someone who actually invests in real estate.

Good luck with the new business.