All Forum Posts by: Terry Gillis

@Chris K. Agree with Chris there are many options and sitting with your legal council and CPA is needed. There also in PA is an LLC - S corp option that maybe of interest.

Pittsburgh REIA has a Rehab house Tour on Sat. You see info on the website

http://pittsburghreia.com/

also from Pittsburgh, ready to do first flip with buyer in hand. After initial flip will do SFR rent to own. Family guy, full time job, HELOC to fund first flip...too similar to your case but about 2-3 months down the same learning curve. My input based on my asking the same questions (I am not a legal/tax adviser) :

#1 Biggest pro for LLC/LP entity is risk reduction and asset protection. As a family man with house, some savings for retirement... asset protection was the sole decision factor. Only con so far is it takes a few weeks to fully process, cost to setup and will require extra tax filings in coming years. For me was well worth the cost in order for asset protection.

#2 No personal experience here, but based on the discussion with legal council, setting up additional entities for owning additional properties can be done now or added on later as needed.  

#3 I'll be following this thread as also wanting to know more about self directed IRA's.

#4 No impact to creation of legal entities. HELOC is driven on personal credit rating, home equity, etc. and nothing to do with new LLC/LP entities. Merely moving funds from HELOC to LLC for expenses. And later moving funds back to pay off the loan.

There is a ton of material out there to read.   I am reading, learning from others, and doing at same time. Long path ahead.

There was a thought that a cash deal (me buying) and not conventional mortgage (son buying) could produce a better deal.  Maybe that was wishful thinking.

Chris - thank you for the quick response and lead on trust and tax approach.  Will do necessary with CPA /legal council.

I am ready to make offer on my first Flip in PA, and my son is interested in exact same property for he and his wife. It is a foreclosure. I am willing to pay cash, he will do conventional mortgage. House needs about $30k rehab. I am willing to take on the work, my son would have to pay me or someone to do the work. Is it best I buy it and then sell to my son once flipped or should he just buy it and pay me to do the remodeling work? Is there an alternative creative way to avoid double selling with me doing the initial buy under my LLC/LP? I am willing to take on the risks of the repairs. He is less likely to assume the unknown risks.