Investing in Rochester, NY: LLC Formation and Liability Concerns

[Mor Maman]

Hello everyone,

I’ve decided to start investing in Rochester, New York. Although I’m a foreign resident, I am a US citizen. My primary focus is on fix and flip transactions, but I’m also open to buy and hold strategies as an alternative exit plan.

From what I understand, an LLC can limit the liability of its shareholder (me) only if it is established in the same country where the property is located. This means that to benefit from the separation between my personal assets and the company's assets, I need to establish the LLC in New York State.

However, I've found that the start-up costs and procedures for opening an LLC in New York State are significantly higher and more complex compared to other states (such as the requirement to advertise in several newspapers for an extended period). Given that I'm currently focusing on fix and flip transactions without tenants, I'm unsure how relevant this is to my situation.

My thought is to Open the LLC in a different state with lower costs and fewer regulations and relying on the insurance for protection (for any case, even if eventually ill decide to bring tenants into the property).

I’d love to hear your thoughts on this.

Thanks!