This lack of registration can create complications for both lenders and title companies, as they may view the structure as less transparent or reliable.Texas has recently made changes to its series LLC laws to allow for cell registration, which is a step forward in addressing these concerns.

There’s no real way to create phantom losses without running into issues with the IRS, and you could end up losing important tax benefits.

I have launched in markets and have been the unique high end stay.

@Joshua Tucker Building real estate on tribal land offers unique tax benefits, but it requires careful planning and collaboration with tribal authorities.

It is worth noting that no matter how profits are split, all of these scenarios would likely require the assistance of an SEC attorney to create a PPM.The example you used was a pre-determined profit. 

I joined Bigger Pockets to further my investor mindset, connect with other investors, and create passive income through affordable housing! 

Even if you create a non-CA LLC, if you are managing the business from California, you will likely be deemed to be "doing business" in California and therefore likely subject to CA taxes.

But your entity doesn't own that rental property; so reporting it on a partnership tax return can potentially create issues as well. 

@Felicia Nitu- Hopefully investors can figure out how to create new housing under SB 684. 

FNMA does have limited allowances if the LLC is whole owned by the borrower. https://servicing-guide.fanniemae.com/svc/d1-4.1-02/allowabl...There's really only three reasons to put your SFR properties under an LLC:1) A DSCR lender requires it: just setup the LLC correctly.2) Anonymity: In Michigan, you can create an LLC with a Registered Agent and use their address to hide your ownership. - Have seen many investors create their own LLC and use their name & address:(- Only works if you put a property in LLC when you purchase.