If you plan on buying/flipping, is it recommended to form a RE construction LLC?

Should I proceed to do research on the property and try and find out who owns the property and send them a "yellow letter" or should I not be bothered with it at all because it may need total reconstruction.

Maybe I could find a surgeon or shrink to kick back fees for these patients......

Now, I get the opportunity to spend a week with people from a variety of occupations including engineers, doctors, IRS agents, internet marketers, pilots, book/magazine authors, artists, surgeons, movie directors, bankers, teachers, flight attendants, lawyers, the list goes on and on and does include real estate investors too.

The remaining expenses carryover to the future as a Passive Activity Loss (PAL).Real Estate ProfessionalTo be a real estate professional, an individual must spend the majority of his or her time in real property businesses:• Development or redevelopment• Construction or reconstruction• Acquisition or conversion• Rental• Management or operation• Leasing• BrokerageThe taxpayer must meet each of the following two time requirements:• More than 50 percent of his/her time working in real property businesses; AND,• More than 750 hours of service during the year.One spouse alone must meet both tests.

"Reconstruction Cost" is not Replacement Cost.

A very successful/knowledgeable investor named Karen Rittenhouse writes in her blog, "A qualified real estate activity is any thing in which you “develop, redevelop, construct, reconstruct, acquire, convert, rent, operate, manage, lease, or sell” real estate.

You wouldn't shop around for the cheapest brain surgeon you could find.

The result is that you can get your price on homes but that buyers have a lot of reconstructed options to choose from.My idea to get around that is to offer a product that allows borrowers to finish their homes to their own desires.... not a novel idea by any means, but we have a few tweaks to the idea that I think makes it at least somewhat unique, particularly for urban re-developers.I decide that the size of these properties I'd just purchased along with their prominent location (Park Front and near a hospital) that this was the perfect time to put this idea to paper and get started on moving from being a nameless re-developer to a brand name company with a unique process, excellent customer service, and top quality homes.

I do not have experience with re-construction, but I can clean up or something, just to see how this acutally works.