New at Investing and struggling with a few things

[Faith Matini]

Hello everyone, I am new to investing and I am struggling with a few things that I would appreciate clarification on. Do I need to create a business starting out or can I just buy a house and rent it out? Is it unprofessional if I have people address checks to me personally since I am starting out? I would appreciate some recommendations on articles I can read to learn more about this.

[Matthew Sullivan]

@Faith Matini I would personally recommend doing anything real estate related under a business entity. Typically many personal based real estate business are LLC. LLC is easy because any money that is collected can be used personally and easily transferred to your personal bank account. A 1099 is whats used as your tax income form. Under a corporation there is more guidelines such as meeting minutes to be recorded etc. Its beneficial to use a business entity for real estate investing because there are more tax benefits to you such as 1031 exchanges, personal liability is limited, looks more professional if you're going to be working with agents and other investors in real estate. If you close on any deals your lawyer would write it out to business but you can just transfer money to whatever account you would want the money...just think if you make money and record under a corp you'll have to pay a tax for that and then if you pay yourself a salary under the corp then you'll be paying an income tax for your self so it's almost like double taxation. I rather have a business entitiy- which is just a piece of paper- hold the baggage than me personally unless I am buying a property I will be living in and renting out.