Finally...someone who made this so simple to understand. :) Thank you! I do have one question: If you pay state income tax on a rental in CA (and you live in CA), will you NOT have to pay the State Income Tax on that property if you move to NV where there is no state income tax?
Wow. You are a breath of fresh air. You actually understand the accounting/tax implications. Lawyers do these things and they are clueless on the intricacies. In my case the i would be foolish to add members (siblings) to the LLC. Complete trust between the three. I agree. I think insurance should be enough to cover liability. Bravo again!!!! Plus you’re quite attractive. 😉 Question: due to MAGI I won’t be able to offset any losses from the rentals. Will I be able to defer those loses when MAGI returns to an acceptable threshold (in 2 years). Currently Maximizing Roth conversions before tax rates go back up. Thanks!!!
How do you pay yourself with an LLC through rental properties? I understand you can’t just distribute money to yourself, so I’m unsure on how to go about that. I am just starting out, trying to get everything in order before my first purchase.
What about State Franchise and Excise taxes? For example, In Tennessee, no state income tax, but there is on businesses, so does setting up an LLC to own rental properties going to result in these new taxes?? The Franchise fee is 0.25% of the "value" of the properties at the end of the year and the excise tax is 6.5% of the net earnings: I hope I find out a single member - disregarded entity is exempt but so far I'm not seeing that in the Manual.
No, forming an LLC does not usually effect state business taxes. It's the nature of the activity - business is business - they don't care if you are an LLC or a Sole Prop, they'll tax you the same.
@@businessfinancecoach Well be aware that Tenn. appears to be an exception to the Norm. Each year you either file for the exemption (form 183) or you file the tax return (Form 170). "The rules as to when an entity may be disregarded differ between federal and state tax reporting. Entities disregarded for federal income tax purposes are not disregarded for F&E taxes except for limited liability companies whose single member (SMLLC) is a corporation." revenue.support.tn.gov/hc/en-us/articles/360057842032-F-E-3-Filing-Requirements-for-Disregarded-Entities
LLC won't necessarily protect your assets if you are proven to be grossly negligent. A judge can still pierce the corporate veil and collect. Additionally, some lawsuits are thrown out as frivolous. Correct that umbrella liability insurance is 100% required. Staying with Schedule E filing is the most profitable way to be taxed.
LLC with rental apartment. if we file with 1065 can we not take a salary but keep the rental money in the LLC business to use for maintenance repair and cash savings. How do we file comes tax time. Thank you.
You are always taxed on Net Income from the rentals - regardless of any entity you choose. The flip side is that you are not necessarily taxed on what you withdraw. (you aren't taxed again, only if you withdraw more than your "Basis" which is everything you as an owner has been taxed on) LLC is taxed as a partnership, if you search "Partnership" and check out other videos on my channel (& on "Paying yourself") they go deeper into how this works.
Hi there, my name is Benito Castro. I live in Cumming, GA. I looked at several of your videos.I will be receiving an inheritance next month and want to work full time in real estate investing. Is it possible to have a one on one to see how we (my wife and I) access your services?
Appreciate your site, I've learned quite a bit. Question: Is there any benefit of transferring your home into a LLC and then renting your home to your self? Another wards paying yourself rent every month?
Im learning as well as you are, but with proper bookkeeping, your LLC would have positive cash flow that looks good to investors/bankers for future investments
Hi there! No, there would be no benefit to this! Don't listen to anyone who tells you otherwise - they are just telling you what you want to hear! :) PS - The reason there's no benefit is because you would report the rental income for taxes for the LLC and then you get no deduction for your personal home.
@@AlahjeLLC No, it wouldn't make any difference because they already have that income. For LLC businesses, they are looking at personal income anyway so no benefit.
You would lose in the long run. In the US if you sell your home you don't have to pay capital gains taxes as long as you use the funds to buy another home.
I bought and apartment under an LLC to renovate and rent it through Airbnb. We are almost done with renovations and there is a possibility to rent it to a tenant. Would it be considered as a business or as an investment if a rent it to a tenant for tax purposes? I would like to take advantages of the start up cost and business deductions
What would be the reason when i was looking at a 20 unit housing building for ownership to contact. . I came across the names of the tenants occupying each unit with dates i assume tax requirements the owner owns must declare his or her rental income. The problem i am having is why the names of the tenants were names i knew in the area that I have never heard of the building and never rented or stepped foot inside before. Why would they put peoples names that the person listed was not even aware of? and why not the real tenants??? I saw my uncle who had lived out the state years listed as an occupant. What tax break or scam was being used there.....Respectfuly Chad
@@businessfinancecoach thank you very much for the knowledge. Yes, it is by fear that got me researching into LLC because I worry that working as 1099 will put my family assets like our home and rental at risk.
The tax assessor just told me that putting my rental property into an LLC & adding my daughter to title would trigger a 100% reassessment of the property. So my $2800 property taxes just went up to $10,700.
We're married filing jointly in a community property state, so will file as a _disregarded entity_ instead of a partnership on our yearly IRS taxes. Do we need to declare this somehow before April tax time?
I really love your slide work and teaching
Thanks! This was so helpful to me. It can get confusing out there on google searches but your presentation cleared up a lot of questions I had.
Ive been waiting on this info. Thank u
Excellent chart at 5:00 explaining Single member LLC!
It would be beneficial to rent the house from your LLC because the LLC can write off everything the rental house needs.
you can do that without an LLC but it protects you from liability
No! That has nothing to do with the LLC - You get to right off all expenses for a rental ALREADY!!
Finally...someone who made this so simple to understand. :) Thank you! I do have one question: If you pay state income tax on a rental in CA (and you live in CA), will you NOT have to pay the State Income Tax on that property if you move to NV where there is no state income tax?
Wow. You are a breath of fresh air. You actually understand the accounting/tax implications. Lawyers do these things and they are clueless on the intricacies. In my case the i would be foolish to add members (siblings) to the LLC. Complete trust between the three.
I agree. I think insurance should be enough to cover liability.
Bravo again!!!! Plus you’re quite attractive. 😉
Question: due to MAGI I won’t be able to offset any losses from the rentals. Will I be able to defer those loses when MAGI returns to an acceptable threshold (in 2 years). Currently Maximizing Roth conversions before tax rates go back up. Thanks!!!
I enjoy the way you teach. Thanks for this!
Hello, I was going to sign up but I see it was thr 17th. I just missed it. Can I watch it and aquire that chart after? Please let me know.
Fantastic presenter !
So do you recommend put every house under different LLC, or all houses under one LLC? If single member only.
I am interested in the real estate crash course and can't seem to find it. Could you point me in the right direction?
Thank you for the clear explanation.
Super helpful. Thank you!
There is difference it tax - if you have LLC partnership you’ll pay extra tax filling fees as it needs additional form
Correct - I talk about that, specifically for married partners it creates a lot more work for the same exact outcome
How do you pay yourself with an LLC through rental properties? I understand you can’t just distribute money to yourself, so I’m unsure on how to go about that. I am just starting out, trying to get everything in order before my first purchase.
Don’t think about it too much your your own business you pay yourself
What about State Franchise and Excise taxes? For example, In Tennessee, no state income tax, but there is on businesses, so does setting up an LLC to own rental properties going to result in these new taxes?? The Franchise fee is 0.25% of the "value" of the properties at the end of the year and the excise tax is 6.5% of the net earnings: I hope I find out a single member - disregarded entity is exempt but so far I'm not seeing that in the Manual.
No, forming an LLC does not usually effect state business taxes. It's the nature of the activity - business is business - they don't care if you are an LLC or a Sole Prop, they'll tax you the same.
@@businessfinancecoach Well be aware that Tenn. appears to be an exception to the Norm. Each year you either file for the exemption (form 183) or you file the tax return (Form 170). "The rules as to when an entity may be disregarded differ between federal and state tax reporting. Entities disregarded for federal income tax purposes are not disregarded for F&E taxes except for limited liability companies whose single member (SMLLC) is a corporation." revenue.support.tn.gov/hc/en-us/articles/360057842032-F-E-3-Filing-Requirements-for-Disregarded-Entities
LLC won't necessarily protect your assets if you are proven to be grossly negligent. A judge can still pierce the corporate veil and collect. Additionally, some lawsuits are thrown out as frivolous. Correct that umbrella liability insurance is 100% required. Staying with Schedule E filing is the most profitable way to be taxed.
Agree - except LLC doesn't change the taxes. The nature of the real estate activity does.
Thank you so much great informations!
Question: if you go with a single member LLC wouldn’t all of your profits be subject to FICA?
a property in a trust and moving it to an LLC will it be considered a boot
LLC with rental apartment. if we file with 1065 can we not take a salary but keep the rental money in the LLC business to use for maintenance repair and cash savings. How do we file comes tax time. Thank you.
LLC with multi-members
You are always taxed on Net Income from the rentals - regardless of any entity you choose. The flip side is that you are not necessarily taxed on what you withdraw. (you aren't taxed again, only if you withdraw more than your "Basis" which is everything you as an owner has been taxed on)
LLC is taxed as a partnership, if you search "Partnership" and check out other videos on my channel (& on "Paying yourself") they go deeper into how this works.
So if you have 10 property you have to have 10 bank account and 10 different credit card?
That's the safest way because everything is separate but you can put two houses in one but they can be soufht after if you are sued
And you can have 1 LLC working as the property management company for the portfolio and all transactions go through that.
If you have 10 LLCs (one for each property) than yes you should use separate bank/credit cards
Or 1 llc and each property on each land trust of its own
Can I form a LLC to re-model a house I already own with the purpose of renting it? And write off the associated expenses?
You can form an LLC for the property and move it into the LLC - remodel and renting it are associated activities
Hi there, my name is Benito Castro. I live in Cumming, GA. I looked at several of your videos.I will be receiving an inheritance next month and want to work full time in real estate investing. Is it possible to have a one on one to see how we (my wife and I) access your services?
Appreciate your site, I've learned quite a bit. Question: Is there any benefit of transferring your home into a LLC and then renting your home to your self? Another wards paying yourself rent every month?
Im learning as well as you are, but with proper bookkeeping, your LLC would have positive cash flow that looks good to investors/bankers for future investments
Hi there! No, there would be no benefit to this! Don't listen to anyone who tells you otherwise - they are just telling you what you want to hear! :)
PS - The reason there's no benefit is because you would report the rental income for taxes for the LLC and then you get no deduction for your personal home.
@@AlahjeLLC No, it wouldn't make any difference because they already have that income. For LLC businesses, they are looking at personal income anyway so no benefit.
You would lose in the long run. In the US if you sell your home you don't have to pay capital gains taxes as long as you use the funds to buy another home.
How to use the LLC if the property is under a person's name? (When the lender does not allow to put the property under the LLC)
Then it's not owned by the LLC
You are awesome….
U missed the insurance part that you promised at the end 😂😁
But I begin journey with you…
i really appreciate you sharing your knowledge, its so appreciated. please keep it up!
I bought and apartment under an LLC to renovate and rent it through Airbnb. We are almost done with renovations and there is a possibility to rent it to a tenant. Would it be considered as a business or as an investment if a rent it to a tenant for tax purposes? I would like to take advantages of the start up cost and business deductions
How Does anyone pay himself in a rental LLC?
You don't. your pay is the net income, just like it is without the LLC
If I wanted to rent a home to a family member while I also own my own home, is this a benefit?
Hey Janette
very informitive ....thanks for the info....
btw...nice nails....
What would be the reason when i was looking at a 20 unit housing building for ownership to contact. . I came across the names of the tenants occupying each unit with dates i assume tax requirements the owner owns must declare his or her rental income. The problem i am having is why the names of the tenants were names i knew in the area that I have never heard of the building and never rented or stepped foot inside before. Why would they put peoples names that the person listed was not even aware of? and why not the real tenants??? I saw my uncle who had lived out the state years listed as an occupant. What tax break or scam was being used there.....Respectfuly Chad
Very useful
The way you teach was soo good. I really enjoyed it. 👍
You’re awesome!
HOW DO I CONTACT YOU FOR A 1 ON 1? I HAVE A FEW PROPERTIES IN LLC'S AND I NEED SOME HELP THIS YEAR?
Do you do 1 on 1 business coaching?
We have a program "Master Your Accounting & Taxes".... but I do 1-on-1 business coaching only for businesses with an environmental/social mission
I'm on a work visa in USA. I have two homes. I want to rent them out. Can I make a llc and put my home and rent it out.
the legal is so messed up where people can just sue like that where you have to do LLC just to protect yourself
you don't have too and it rarely happens
you get insurance - for most people the LLC is overkill and driven by fear
@@businessfinancecoach thank you very much for the knowledge. Yes, it is by fear that got me researching into LLC because I worry that working as 1099 will put my family assets like our home and rental at risk.
The tax assessor just told me that putting my rental property into an LLC & adding my daughter to title would trigger a 100% reassessment of the property. So my $2800 property taxes just went up to $10,700.
Local property rules effecting local real estate taxes - thanks for sharing!
@@businessfinancecoach my attorney is helping the assessor’s office on how our LLC is structured. Seems that should’ve never happened.
Okay ima own property. Then they loose a jeweler
It's better to just not use it
We're married filing jointly in a community property state, so will file as a _disregarded entity_ instead of a partnership on our yearly IRS taxes.
Do we need to declare this somehow before April tax time?
No, you can just disregard the LLC and file your Schedule E as if the LLC doesn't exist in that case.