Quote:
Originally Posted by ErikLS2
I have always had an LLC for any investment property I've owned. It protects your personal assets from any lawsuit related to the property, if set up right AND you don't co-mingle personal funds with LLC funds. It must have it's own bank account and you can't ever buy anything personal from it. You can take cash out to "pay" yourself and contribute to it if you need to for big expenses and stuff and if it's a single member (meaning no partners) it doesn't need it's own tax return, it just goes on your personal return.
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Good call. I kind of skipped over that part.
That should be the first thing you do IMO. I actually set mine up before I acquired the actual property.
You can own several properties under one LLC -- some do it that way, and it's better than nothing -- but having a separate LLC for each property is the cleanest and offers the most protection.
To be clear on the LL insurance policy -- it is to provide legal representation in the event of potentially expensive events such as unlawful eviction. You have to have Homeowners/GL policy on the property anyway - so paying a little more where 6 figures of legal fees could be provided by your carrier under a number of unfortunate circumstances is worth looking into IMO.