All Forum Posts by: Laura M.

I have a number of properties that I rent out, and am trying to properly set up an LLC for those. One of our rentals is a detached granny unit in the back yard of our personal residence. We are currently renting it to people who are doing 4 month traveling details for a government entity. This gov't entity actually has actually suggested that we become contractors for them, so that they can pay us directly to retain the property for their traveling employees. Apparently the paperwork is a pain in the rear, but probably worth it to have the place always rented. Of course we need to have a business entity in order to do this. The unit doesn't have its own meters.

 Is there any way we can shift our liability for this rental away from us personally and towards our LLC via some sort of a contract between us and the LLC?  I know I need to consult a lawyer, I’m just wondering if anyone has thoughts about how this situation might be handled.

Thank you both! I will check with them and see if they would be a good fit.  Cheers.

Hi Colorado Springs!  I am looking for a  colorado lawyer who has a strong understanding of real estate investing and can advise me in entity creation / set up for our various businesses and pieces of real estate. I actually don’t live in Colorado Springs, so location is somewhat loose. (I live in the San Luis Valley). Thanks in advance. 

True. I could pay my mother and father in law to do the landlording? Could I pay my husband’s real estate management business to do it? Someone has to do it, and if I am not well enough, can my spouse not do it in my stead?  If I purchase it with my husband’s IRAs, and if he does the landlording, then could he could take withdrawals, which would then pay social security taxes, on right?  It seems like we aren’t evading taxes, we are just trying to manage our own investment, and pay the associated costs. I also understand that the business structures of all of this are complicated, and we are going to consult a lawyer— I just want to understand it better myself when I talk with them.

My other question is this:

If you have an SDIRA, who is YOUR custodian, and do you love or hate them?

Thank you! If Ihave a properly arranged SDIRA, and put the property into an LLC owned by my IRA, can I take payments in exchange for the landlording work? I need the income from my non-passive investment in order to live today. I can give that income to my husband, who does do the labor. But can I have some sort of profit from the LLC that I can use to live on right now? (As we do with our other rentals). I have not yet finished the Bigger Pockets book on real estate investing, and am reading some other sources—- I'm just looking for some general conceptual pointers about how the book-keeping acutallly works.

My neighbor passed away unexpectedly. He was a lovely man, but a real slob, and I am trying to buy his house from his next of kin, a brother & sister who are not as eager to sell as we had hoped. The place needs a lot of cosmetic work, but is essentially solid and we want to buy it with IRA funds, and then use it as a rental. We can add additional unit(s) in the back yard. I have acquired a rare illness which means that I have become disabled over the past year, with small children. We are self-employed, and since I've gotten sick we have had to shutter our former business and focus on adding rentals to our portfolio. Fortunately, we are continuous renovators, and we have several pieces of property that we have been able to purchase and rent with excellent returns. I bought a house last year (also on our street) with a mortgage, and I withdrew funds from my IRA to put down the downpayment. Because of 12 other emergencies happening at the same time, I just withdrew the money, and didn't put the property into an IRA. (I withdrew it tax free because it was all principal on my Roth IRA).

Questions:

1) I presume that I cannot retro-actively put the house I’ve already purchased into a SDIRA. Is this correct?

2) I am looking for recommendations to quickly move IRA funds from Vanguard into a Self-directed custodian. Which custodians should I consider?

3) I really need to consult a disability lawyer, but I am going to be applying for disability benefits, so any advice on keeping rental income from being counted as me “working” would be appreciated. We currently have 4 rentals (2 long term & one on Airbnb, and one RV in the yard of our commercial building (!)), and we are managing a couple of others for family members.  I’m the planner, and my husband enacts the plans. I used to be very hands-on involved, and loved it, but my health has made that extremely difficult.  It is our intention to keep adding rentals to our portfolio  for a while, as we are well-suited to owning and maintaining buildings, and we really enjoy the process of buying ugly properties and then transforming them into something that can bring us a really regular income from renting them.  But for the moment, we are just trying to take advantage of the opportunity to purchase the house next door, which we can always flip if we don’t have the mojo to fix it up ourselves. Either way it will benefit us greatly to have control of the house and de-junk it. If nothing else, it will add a lot of value to our own house if we improve the street a bit.

The contract is assignable. It is a rural area, so there are no local investor meet ups, I'm afraid. The market is fairly hot, in that the area has a historic low of inventory. The surrounding towns have all "popped" to varying degrees, in that the surrounding competition is getting quite fierce, which pushes the market here, as people flee the Front Range in search of greater affordability and less traffic....  If I had the money, I would buy it and rent out until I have the time / ability / bandwidth to renovate it. It's bad timing for me financially, unfortunately.

I have a contract to purchase a 2-unit house in one of the few cute, historic Colorado towns that are still affordable. The historic house is currently commercial on the ground floor with an apartment on the second story. Can be used as commercial / mixed use or as a 2-unit residence. The downstairs unit doesn't have a proper kitchen, because it is currently being used as commercial space. Except for the missing kitchen cabinets & appliances, it is perfectly rentable (needs paint & new carpet, and associated freshening up.) I planned to purchase the house and turn it into a short term rental (Airbnb). THe house is selling way below its market value because it is currently junked up with the owner's possessions, and the owner is a curmudgeonly old guy who is not a savvy seller. However, I am simultaneously purchasing the major historic building in the downtown, so I just don't have the capital to purchase this house. My price is easily 100K below what the house would be worth if the property were cleaned up and marketed properly. And that is without taking into consideration the major investments in the downtown that I have inside knowledge about. Am I crazy to try to find a buyer who does have the capital and wholesale it? It seems like it could be a GREAT deal for someone else to flip or BRRRR or to hold long term. I don't know anything about wholesaling, and have never even considered it until today. Would love to hear some thoughts or advice. Thanks!

Hi all!

I am looking at buying a high end property, but can't do it unless I can figure out how to get it to cash flow.  I want to buy it because it is an incredible deal on 1200 contiguous acres of mountain property, with unbelievable natural resources, that I would personally love to figure out how to own and hold for the duration.

I can get the property for somewhere in the neighborhood of $1.3M.  It has a big, gorgeous "main" house (4+ beds and 3 baths) on it that the owner built for probably about $2M. It also has a gorgeous efficiency apartment above a garage, and another 2bed house on it. All are remote, impeccable, very high end. I am uniquely suited to own the property and would dearly love to do so. (Which is to say that I have an emotional investment in trying to make this work, and am trying to be very clear headed about that fact.)

The houses could easily be used for vacation rentals, weddings, corporate retreats, yoga retreats, meditation retreats, etc. But it is far from the nearest urban area, and so I feel like feeling the vacancies-- especially in the first couple of years-- would be fairly difficult. I am trying to think out side the box about how I could utilize the amazing houses as a retreat center of some sort, and am struggling to figure out how I could systematize the rental of this "retreat facility" such that it could actually cash flow reliably.

The houses could easily make an wonderful B&B, but I have zero desire to run a B&B. 

The property is nicely located near a national park with few amenities and not enough campgrounds, but otherwise is a very remote location.  I have contemplated putting in a small RV park (40-ish spots), but am a bit wary of the massive amount of ongoing work to manage / maintain such a facility, which I would have to hire someone else to do. The campground could be fairly primitive, (which is customary around here in CO), and I expect that occupancy would be very high all summer due to the nearby national park, bike riders, baggers of 14 foot peaks, climbers, ice climbers, etc.

I could not possibly afford to own the property unless it could cash flow about $6-$7K per month after the first couple of years. I am looking to hold it for its appreciation, and to preserve an incredible piece of property, and I am looking for long term cash flow. The population of CO is exploding, and I don't know if I will ever get an opportunity to buy such an amazing property again.

Just wondering if anyone has any other ideas to throw around. Thanks!