Must a LLC be based in Philly to own rental properties there?

[Kathryn S.]

Hi I'm based in Jersey working on first out of state LLC investment in Philly. Didn't think where LLC is based could have an impact on owning rentals in Philly. Another investor friend suggested that the LLC should be based in Philly. I always thought LLC passes through to its Members, there will be taxes for Philly etc. Anyone has experience in this area?

I would've posed this question to my tax accountant. But she decided to move onto other ventures. So I'm in the process of finding an accountant, to complicate things. 

Thank you very much!

[Ryan D.]

Originally posted by @Kathryn S.:

Thank you Michael. I know PA government does not require the LLC to be formed in PA. Just wondering the pros and cons of forming the LLC in Philly vs NJ. The tax impact should be the same no given that this is a LLC? Thank you

I'm not a CPA but yes the taxation is similar. The main difference is cost. Annual dues for an LLC in PA is one of the lowest in the nation at $70 every 10 years. Annual dues for an LLC in NJ is $75/year. Both cost $125 upfront.