All Forum Posts by: Matt Eade

Hello, question... Is it possible to have an LLC partnership (my sister and I) that has a mix of property ownership? We would be co-owners of a 12 unit apt house and each receive a SFH separately through our father's will (currently in probate). There are 4 other siblings to pay off over five years. The idea is for my sister and I to combine all three properties revenue, risk and maintenance in one LLC and pool the money to buy out the siblings AND keep separate deed/titles to our individual properties to do with as we wish after the 5 year buyout.

Hello. My sibling and I are about to inherit property from our father's estate. We are both inheriting a 12 unit apartment building and each of us is receiving an additional separate property, one is a single family home and the other is a duplex. There is no inheritance tax given the value of the estate. The property is in NY state. Sibling lives in NY. I live in California. It seems like an LLC partnership would be the way to go for the apartment building. Would people recommend that we set up separate LLCs for our individual properties? Am I correct to assume since the properties are in NY the LLC would need to be set up in NY as well? Also wondering if anyone is aware of the tax implications for residing in California and owning property in NY.

Hello, My father is looking to re-write his will to accommodate me and my 5 siblings recent wishes. After explaining the below to his lawyer, the lawyer said it was very complicated with several tax implications (which we are trying to avoid of course). So of course I thought I'd ask fellow BPs. 

My father owns 3 properties in upstate NY. One is a 12 unit apartment building, one is a SFH and the other is a duplex. 2 of his children (myself and older sister) would inherit the properties (partner on the 12 unit and individually own the other 2 separately).

The other 4 siblings would get a cash buyout that we've all agreed is fair (and substantial).

The challenge is how to provide the cash buyouts as part of the will and avoid income tax for the 4 siblings... notes below from lawyer. 
Does anyone have experience with a "Time Note"? Is it different than a "note"

"If the payment is specified in the will, it is an obligation of the estate to pay it and cannot be classified as a gift even if paid out at a later date and therefore it would be taxable income to the 4 siblings."

"The subject of some kind of note came up. It could be a demand note or a “time” note, payable over time. The demand note could be problematic since the 4 siblings could demand the money at any time and that payout may not be possible. Also, if you are married and you unexpectedly pass away, your spouse could demand the money all at once--not a good situation."

"A time note would have to carry a stipulated interest (so as not to be considered a gift) as determined by the laws of your state. The interest would be income to you and taxable, but it may not be significant to make much difference to you tax wise."

Hello! I am a pro member of BP and love all the different tools and calculators that come with it. I'm looking to supplement these with an online data analysis tool like Top Hap or ProStream. Does anyone have experience with either? What I would love to have is a tool that overlays the asking price with the estimated rent for that property, shows the margin and then is searchable for highest to lowest. A crime index on top of this as well would be great, school ratings, property tax, rental control, etc. All in one unified view... Too much to ask? Anything like that exists?

Hi all. I'm building out a proposal to buy out siblings on 3 rental properties that are part of a future inheritance. For that proposal I'm looking for information on what the estimated costs are for selling commercial rental properties in New York State (not NYC). Appreciate any information you can give. Thanks!

@Steven Luttman. Thanks. That’s a good idea. They are flexible on timing.

Agreed that it's future speculation and all numbers can change. These are my father's properties to be passed down to his children. I will be keeping as a rental. Goal is to hold for next 10 years. Thanks!

Hello fellow BPs!
I have what I think may be an unusual inheritance situation. But also probably common between siblings and parents trying to figure out how to equalize future inheritance. My father, and my grandparents built up 3 rental properties over the last two generations in upstate NY, south of Buffalo. One is a 12 unit 100+ year old 3- story Victorian apartment building. One is a duplex and the other is a SFH. They are all on the same block and all well maintained over the last 50 years by my father. There are no mortgages.

I told him years ago that I didn't think I could manage property from so far away (California) but thanks to Bigger Pockets and reading all the posts over the last year, I'm feeling that they can be managed by a good property manager. Thanks BP!

I would like to take on the Apt House. 2 other siblings would like to split the other 2 props. So 3 siblings on properties, 3 cash out. 

My goal in owning the Apt house is: cash flow, leverage equity to buy more real estate investments in CA or across the country and sell in 10-15 years. 

In order to do a full buyout for my 5 siblings, I would need to come up with $315,833. That leaves: $94,167 in equity and a LTVR of 77%. Pretty sure I can't get a HELOC of that size or with those ratios to cover the buyout.

12 Unit Apt. House

• Net Rental income: 25K which includes an est. 10% management fee.
• Valued at 400K.

Duplex

• Net Rental income: 10K.
• Valued at 80K

SFH

• Net Rental income: 7K.
• Valued at 80K

Does a full buyout to my 5 siblings make sense? 

Is it possible to get a loan based on the numbers above?

What other considerations would you be thinking of in this scenario?

Anyone familiar with tax implication on owning NY prop and living in CA?

@Kaja Baum

I grew up in WNY (Olean) and am in a position to potentially take on properties as part of an inheritance with buyout to siblings. I've always resisted the idea of managing properties (12 unit Victorian apt. Duplex and SFH) from afar (Oakland CA). Trusting a property manager to give the attention that my Father has to these properties seems a stretch. So if you come across any reputable prop. Managers. or companies, please let me know. Thanks. And good luck!

@Edwin L. just starting so not sure if the Lee it process. I’m lucky that my next door neighbor is an Architect and    will be helping me along the process. 

@Brian Garlington I’m in Cleveland Heights. 2 blocks off the lake.