Instead, keep the property in your name or transfer it to an LLC for liability protection.Since you’ve lived in the home for at least 2 of the last 5 years, selling now could qualify for a capital gains exclusion of up to $500K (MFJ) or $250K (single).

If you do not have a loan you would be very foolish to not have substantial liability insurance at a minimum.

I want to be able to keep business finances and liability separate.

That said I like to be able to run year end reports with an estimation of tax liability so I can provide financial statement information to investors/etc.

Quote from @Devin James: Quote from @Dominic Mazzarella: Quote from @Devin James: Everything went wrong with this investment:   - Took 4 months longer than expected   - Cost $10K more to build than we anticipated   - Sold for $20K less than we anticipatedWe still profited with a 30% return on equityThis is why I love Real Estate InvestingWhen you do your diligence and stay conservative with your numbers, it takes something really bad to lose money.Here was the original post:My siblings and I are building a home in North Port, FL.Here are the numbers: - Finished Home Value: $412Kish - Land Cost: $19,750.39 - Construction & Permitting Costs: $304,897Additional costs: - Environmental Site Assessment - General Liability Insurance - Builders Risk Insurance - Construction FinancingWe will be listing the home this weekPhotos coming soon!! 

Ordinarily those tenant vacated damages would be too remote, but it sounds like they were contemplated by both parties at the time of contract.Were I in this situation I would be looking to state law to determine if the EMD is truly the extent of my potential liability as a buyer. 

I house hacked both the properties I have and thought I should put them into LLCs for liability purposes, did not realize that I would have trouble getting a HELOC in the future.

Additionally, have a clear budget, factoring in potential repair costs, and ensure you understand the rules about earnest money deposits and closing deadlines.LLC for Real Estate Investing: Forming an LLC for rental properties can offer liability protection and may provide tax advantages, though the tax benefits are non-existence for rentals.

I’m worried about: - Liability if the tenant decides to take legal action

PM's will have plenty of contractors to help streamline the process for you and limit your liability when dealing with contractors.