Corporation vs LLC for Real Estate Investors

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Clint Coons Esq. | Real Estate Asset Protection

Күн бұрын

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Should you create a corporation or an LLC for your real estate investing business? Although we use, and create, LLC extensively for real estate investments they're not always the best choice in every instance.
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ABOUT CLINT COONS
Clint Coons, Esq. is one of the founding partners of Anderson Law Group, Clint has grown his legal and tax firm to over 400 employees by assisting real estate investors with creating and implementing solid entity structuring plans. His success in these regards is in large part due to his personal investing experience. A successful attorney, real estate investor, and speaker, Clint has used his innovative and dynamic strategies coupled with knowledge borne from experience to help thousands of people save millions of dollars and build real wealth.
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The information provided in this video should not be construed or relied on as legal advice for any specific fact or circumstance. Its content was prepared by Anderson Business Advisors with its main office at 3225 McLeod Drive Suite 100 Las Vegas, Nevada 89121. This video is designed for entertainment and information purposes only. Viewing this video does not create an attorney-client relationship with Anderson Business Advisors or any of its lawyers. You should not act or rely on any of the information contained herein without seeking professional legal advice.
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Пікірлер: 75

@ClintCoons 8 ай бұрын

Hey, are you interested in diving deeper into this topic or chatting with an expert? Feel free to schedule a call here: aba.link/745ba9

@adriennenicole7687 5 жыл бұрын

Such a great video. The one thumbs down is the person that just found out that they set up the wrong entity🙄

@monica_954dale 5 жыл бұрын

I always thought about getting a C corp from the beginning! The guy that was trying to set my entity up he talking about get a LLC..thanks you gave me confirmation with this video!

@darinladick6666 4 жыл бұрын

Why in the world would you NOT go with a C-Corp with any of the covered scenarios?? A C-Corp lets you pay a fixed tax amount no matter how much you earn instead of having the earnings flow through to personal tax on a K-1 where you're going to get eaten alive. Also, if you want to take money out of the business a C-Corp lets you take it out with the option of additional with dividends that are taxed as long-term capital gains with a cap of 15%! Not to mention the liability aspect...C-Corp shareholders hold no liability, where S-Corp and LLC shareholders hold 100% of the business liability because they own it.

@ofirmichael 4 жыл бұрын

these guys are true professionals! great advise for so many different situations. and the great thing is that they go beyond an advice. they can set these structures for you.

@ClintCoons 4 жыл бұрын

Thanks Ofir. Great to see you at the 3 Day Tax and Asset Protection Event in Boston this past week.

@Amerimedia 2 жыл бұрын

This man is brilliant! Advice is crisp and clear.

@ClintCoons 2 жыл бұрын

I appreciate that!

@loyaldeterminedcom8234 3 жыл бұрын

Which One Do You Recommend(LLC, Land Trust, C/S Corp>Buying Land To Build A House To Sell Or Buying Land To Build Multi-Family, Condos, Townhomes To Sell Or Rent Out.

@ClintCoons 3 жыл бұрын

Each on of the entities you mention has a use in real estate investing. As a general rule, for short term deals I lean toward corporate taxation (llc taxed as a corporation or an actual corporation) and for longer term investments an LLC. I have several videos on the investing topics you asked about with specific strategies for each.

@loyaldeterminedcom8234 3 жыл бұрын

@@ClintCoons Thanks For Getting Back With Me. I Will Go Back & Watch Your Videos.

@TrailerCashAcademy 5 жыл бұрын

Appreciate the gems in this one!

@jimfranklin3885 5 жыл бұрын

Thx Clint, great content! The entity I'm thinking about wouldn't just be about real estate but could include engineering.

@ClintCoons 5 жыл бұрын

Yes

@medicationeducation6891 4 жыл бұрын

Why do I need an LLCor Corporation If I can just put my properties in a trust account and just live off a salary I set up to be paid out as tips for being a trustee

@Matt-hw6tm 3 жыл бұрын

1244 small business stock as ordinary loss being 1. Corporate earnings potential another. Downside to C Corp is the double taxation.

@michaelfawehinmi6806 3 жыл бұрын

Can you use your S Corp to create an LLC for the purposes of buying and holding property? This is in the case your regular business operations for the S Corp consists of flips and wholesales.

@ClintCoons 3 жыл бұрын

Absolutely. Check out some of my flipping videos where I discuss the strategy you are referring to.

@accentedreality 5 жыл бұрын

Awesome, awesome, awesome advice for a new investor! Solid video that I will be sure to recommend

@JimmyHFinancial 5 жыл бұрын

Hi Clint, I will be buying and holding so LLC sounds like the way to go..can and should I transfer my properties into an LLC even though they have a mortgage?

@kattwatts1753 2 жыл бұрын

Hey there Clint! So, Im purchasing a commercial property with two partners at equal share. We are building a brand new building and plan to place our own business on the Property as well as having excess square footage to rent out. so it is a buy and hold situation. Should we put the purchase under an LLC OR S Corp? we are putting a lot of money upfront into the build. ??? thank you !

@ClintCoons 2 жыл бұрын

The building should be owned by an LLC and run the business through a different LLC.

@gavindane4037 4 жыл бұрын

Clint, how can you buy a house in a C-Corp. Bankers keep telling me they don't do that. And with a personal guarantee and a big down payment, it should be easy but they hate it. Thanks!

@ClintCoons 4 жыл бұрын

If you are using financing and it is a residential property then you will definitely have issues.

@phillipborbon6598 5 жыл бұрын

ah man now im confused each time, so i want to buy and hold, an llc instead? and can i transfer from an llc to a c corp?

@ClintCoons 5 жыл бұрын

Phillip set up a strategy session with the link in the notes and we can help clear up any confusion.

@funkyboogiee 4 жыл бұрын

what if you want to flip a property with family member, have no education expenses to try and write off, also want to increase your income, and may want to flip again after first one is done? LLC or corp???

@ClintCoons 4 жыл бұрын

Spencer use this link to set up a strategy session to discuss. aba.link/30minSession

@dedewilliams8753 4 жыл бұрын

Searching to establish anonymity in business. But is there really any such thing? I am a veteran in the process of opening 6 TX LLCs (variations of real estate, a restaurant, and on-line clothing).

@ClintCoons 4 жыл бұрын

Yes you can keep your name of the LLCs if you set it up with a WY LLC as the member manager of the TX LLCs and you should consider using a Series. If you would like a strategy session you can find a link in the show notes.

@marshawnmoore1679 4 жыл бұрын

What if you want to do primary Buy & Hold and do a few flips?

@ClintCoons 4 жыл бұрын

Consider a corporation for the flips and the LLCs for the holds

@CLR-RealEstate 2 жыл бұрын

Say if someone pays for a mentorship program, can that be a write off?? Thank you very much. Your content is amazing.

@ClintCoons 2 жыл бұрын

If it further's your existing business then you can write off the consulting expense through your business.

@MetalBum 5 жыл бұрын

For a triplex flip should I do a s Corp instead of llc. I’m going to hold it for 1-2 years then flip it

@ClintCoons 5 жыл бұрын

No I would use an LLC to keep the income as LTCG on the sale of this investment property.

@richardrivera7317 4 жыл бұрын

I buy & hold in Texas & my Wyoming LLC owns my Texas LLC. How many 1 family residential homes should be in each Texas LLC?

@ClintCoons 4 жыл бұрын

I would put 1 per LLC or if using a series LLC then use a cell.

@om8652 2 жыл бұрын

If you have a primary that you want to turn into rental does the open s-corp and sell yourself the S-corp and the. Rent the property still apply or open an LLC and files taxes under S-corp status? Too much conflicting info out there.

@ClintCoons 2 жыл бұрын

Yes - see my video on selling your residence tax free.

@freddykrueger8759 2 жыл бұрын

Thanks🇺🇸

@condohatesme 5 жыл бұрын

Is there anything wrong with electing to be taxed as an S-Corp before you’ve made $35,000, or in my case any money at all? I’m aspiring to get into real estate flipping and I have not done a single deal yet. I’m simply trying to set up my LLC, and business name, etc.

@ClintCoons 5 жыл бұрын

There are several variables that go into making the proper tax election for your flipping entity. I prefer C so the activity does not appear on my personal return as this could turn off the traditional lender.

@Ozzturd 4 жыл бұрын

what about owning both an c corp and an llc under that c corp, is that possible?

@ClintCoons 4 жыл бұрын

Yes but you should speak with someone as to the tax consequences.

@alliesteamc3546 3 жыл бұрын

Question: we heard LLC can have I. Operating agreement no regular meetings and only when needed. But C corp law have more requirements to have annual meetings and elections so more costs to maintain, can you compare this?

@ClintCoons 3 жыл бұрын

Yes the C-Corp does have annual meeting requirements but you can tackle these in 10 minutes. If you are the only director/shareholder there probably isn't much to discuss so the meetings become more of a formality. I don't see the corporation costing more than an LLC to maintain (unless the state of organization different taxes or renewal fees)

@lesiejackson494 4 жыл бұрын

How do I anon if my llc is a partnership.

@ClintCoons 4 жыл бұрын

You must use a WY LLC to hold your interest in the special purpose LLC. The WY LLC will be the partnership

@rheacecontracting 2 жыл бұрын

So an Airbnb arbitrage business you would use a Corporation utilizing a master lease agreement?

@ClintCoons 2 жыл бұрын

We use the corporation when you can not qualify as materially participating and you do not want he property treated as STR on your 1040.

@IceBlueThug 5 жыл бұрын

I want to do flips and wholesaling in the beginning stages of my real estate career. After that I want to do buy and holds . My initial tuition cost to learn is about $13,000 . I don’t think this is something I will ever say “!its not for me.” Which is best for me ?

@ClintCoons 4 жыл бұрын

Typically I would suggest a corporation. Check out this video kzfaq.info/get/bejne/g75mh92eqamwomQ.html

@eanharrison4976 3 жыл бұрын

How to get a l l c license

@peopleofthestateofcalifornia Жыл бұрын

I think that it is important to have both a LLC and a corporation

@santiagosadventures3685 3 жыл бұрын

I currently have two properties that are rented with no LLC or Corp. I want to continue buying more rental properties and i am not sure if one LLC or corp would cover all the houses. I ask because i have heard people say that you should have one LLC per house and i don’t want to do that. I want to have one business not multiple business. Please let me know if i am understanding this correctly?

@ClintCoons 3 жыл бұрын

The reason people say "1 property per LLC" is to reduce risk. If one property is assaulted then all properties in the LLC holding that property will be at risk. If you want to keep it simple and just use one LLC then consider holding your properties in the LLC and leasing them to a corporation that leases to the tenants. The Corporation will serve as the landlord and not the LLCs. This will provide some protection but not complete like a 1 property per LLC strategy. You might also think out using land trusts to hold the properties and have the beneficiary your single LLC.

@bleacherz7503 3 жыл бұрын

For buy and hold 2nd residence , I hear that llc S Corp real estate taxes are super high ?

@ClintCoons 3 жыл бұрын

For a 2nd residence you would probably want to set up an LLC that is disregarded for tax purposes.

@DL-1 5 жыл бұрын

What about incorporation versus s Corp, versus LLC, for truckers and trucking companies? that would be a big deal for us.

@ClintCoons 5 жыл бұрын

Absolutely you can use the same strategy. Typically for truckers, we recommend an S-Corp for the business and an LLC to hold the bobtail and/or trailer and lease to the Corp.

@DL-1 5 жыл бұрын

@@ClintCoons great strategy.it may take me a few months to save the capital for the equipment purchase.I'm almost halfway to the fund amount.i should be ready in December.

@yeeast8395 3 жыл бұрын

Just brought a house for a great deal . Plan on flipping it . As far as tax wise which would be better llc or s Corp ?

@ClintCoons 3 жыл бұрын

Either will work if it is just a single flip; you don't need to concern yourself with dealer status. If you intend to flip more properties, then dealer status should be something you consider and possibly set up a corporation or LLC taxed as a corporation.

@alejandrorojerogonzalez193 2 жыл бұрын

Hi Clint I have a fee Properties that are under my name .I do have a bussines under llc s corp can I used this s corp and change it under my bussines s corp . Or it's better to create a 1 llc per house

@ClintCoons 2 жыл бұрын

One LLC per house. Do not place your real estate into an LLC where you are running an active business.