To LLC Or Not To LLC In Real Estate
The honest answer is I am not an attorney or accountant and I do not know. What I do know is that I have seen thousands of investors buy properties to either fix/flip or buy/hold and many of them do it differently. From my experience and only my experience, most of the legal liability that I have seen come back on people is so small and irrelevant that it would not matter if they owned the property in an LLC , S-Corp or their own name. If the person is properly insured I have seen very minor lawsuits like slip and falls that usually are covered. It doesn't mean that something catastrophic can't happen and that the protection of the entity would help, but after seeing thousands of landlords buy in different ways, it doesn't appear to be something that should be over thought. From an accounting standpoint that could be completely different, but the reason this entry is being written is so people don't find themselves frozen in paralysis analysis over something that can be easily addressed. There shouldn't be an overwhelming fear. Speak with your real estate attorney and accountant, and then start or continue to invest. Don't lose sleep or let something like this stop you.
Ian Walsh
215.839.3271
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