Llc?

[firehawkocean]

Hello all,

I have a home in CA that I rent out to tenants.

I live in TX and plan to stay. I own a home in TX now also. I will be living in that home for at least a year and then plan to rent it out as well.

Would it be advantageous to set up an LLC.

Might I pay double taxes?

[dczech09]

Consult a CPA on how you should do this. Here is some light reading:

https://www.ftb.ca.gov/businesses/bus_structures/LLcompany.shtml

Your tax situation will depend on whether you file an LLC as a partnership (sole proprietor) or S-Corporation. If you file as a "partnership," then the business is disregarded as a separate legal entity, thus the profits of the business would flow through to you the "sole member" and you would report that as an income on your own taxes.

If you file as an S-Corporation, it would be recognized as a separate legal entity, have its own tax burden, and you would essentially have "double taxation."

With that said, I see A LOT of businesses in my line of work. It is not at all uncommon to see a rental property organize under an LLC. But you should still consult a CPA regarding your own personal situation.

[sblatner]

California has an LLC fee that is a minimum of $800, I believe. Check into that before you set it up.