All Forum Posts by: Kevin Hurney

Then I'd suggest you stay far away from an employee/employor relationship and work out a partnership arrangement. Most investors use an LLC (Limited Liability Company) where the "partners" are Members of the company. Smaller operations usually select a partnership tax election and have income flow through to each member individually on a K-1 to your 1040. I'd suggest you speak to your tax advisor as to passive and active incomes before you set up the company as well.

As to the company, and setting the purpose, I'd suggest you think about what you might do in the future and elect all possibilities up front as that catch all phrase of doing all things necessary, etc. may not cut it in RE. Be specific. Mention that to your attorney as many use boiler plates to form an LLC.

You'll also need an Operating Agreement and make sure you address the removal of members as well as buy out provisions. Unless your spouse (now or to be) wants to run a company, include yourself at what ever buy out provisions you need in the event you become incapacitated or pass on.

Lastly, be careful in the Operating Agreement so as not to create an employee relationship with you supervising or requiring when or how work is to be performed, such can triger tax problems, workmens comp and withholdings.

You might try to put it together yourself, but really, it's your business and I'd suggest you pass everything by an attorney to have it blessed with legal water....good luck

How do you plan to "employ" these people? How do they get paid?