Newbie from Chattanooga

[Brighten Miller]

Howdy,

I am Brighten Miller and I recently retired from the Air Force and ended up in Chattanooga to be closer to family here in Tennassee, and North and South Carolina.

I currently own four rental properties (purchased as my primary residence at each of my stateside assignments over the years) and am looking into purchasing additional (primarily single family or duplex/triplex) properties here in Chattanooga/Ooltewah as investment properties.

I've been lurking on BiggerPockets for the last few months and even asked a question recently on the forums and decided that I should introduce myself.  Based on what I've learned here at BP and elsewhere, I have pretty much decided that I need to manage my properties better and utilize some asset protection strategies (LLCs and Land Trusts) about which I've recently learned.

I'm currently researching local CPAs and attornies as well as the many many online incorporation/LLC building websites as well as just reading BP articles and forums.

[Brian Levredge]

@Brighten Miller, a couple quick tips about TN. There is no state income tax here for properties owned in your name personally. There is a Franchise and Excise (F&E) tax levied on LLC's, S Corps, and other entities that offer legal protection. There is also an exemption to the F&E tax on closely held, family owned real estate businesses whereby as long as you don't have more than four residential (1-4 unit) properties in the LLC then you don't have to pay the tax. This doesn't apply with more than four properties, apartment buildings, or commercial properties.

If you are planning on using financing on your rentals here, I would probably stay away from land trusts. Banks don't like them because they obscure ownership and if not properly executed they can screw up the chain of title and make a property unwarrantable. You will generally add several thousand in compliance costs per LLC set up annually for the tax return and annual reports. Just something to keep in mind in your decision making process. I own in both LLC's and my name, and at the end of the day a good insurance policy is always first with financing in place being a close second in acting as a deterrent to lawsuits.

Also happy to provide you with a couple referrals for attorneys and cpa's.  Feel free to PM me.