I am new to real estate investing and have a question that is bothering me.

I called my accountant and asked here about setting up a corporation for real estate investing and she recommended that I wait until I get a couple of properties before I setup the corporation. She currently handles my personal and business taxes, so she has nothing to gain by recommending that I wait, but do you all think? She did recommend I go with LLC when we do file, but I am puzzled as to why I would want to wait? She said it was to give me time to decide if I really wanted to be in this business and also taxes were more expensive.

What would you do?


Thank you for any response in advance.

One bump for weekend crew.

I would follow my accountant's advice If you have no properties why would you need a corporation? Over the years I have attended numerous seminars, both real estate and non-real estate alike. It always amazes and amuses me to see attendees knocking each other down to be first in line at the back of the room to sign up for the latest and greatest deal. Now, I'm NOT knocking these educational courses. I spend thousands each year on my own education. But really, if you've not yet purchased your first investment property and your only assets cosist of your home and automobile WHY would you see the need to purchase a $5000 asset protection course???

Just my $0.02

Bill

I am sorry, I have no idea what you are talking about? Perhaps you replied to the wrong thread? I am not buying an investment course. To me, anything you have to buy that promises to teach you how to make big bucks is just a scam.

I was only wondering what others thought about having a corporate shield up before one bought their first property, or is waiting until one has a few under their belt the general method? Keep in mind, I already have a business, it is not like I am new to the business world. I am only new to real estate investing.

I think there is nothing wrong with having one up asap. In fact the corporate credit world looks for aged llc's anyway, so even if you are not using it right away that is ok.

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Steven Brown
Cash 4 Houses, LLC
HomeVestors
Mobile, Al
251-366-HOME
steve.brown@homevestors.com

That is what I was thinking. I remember how hard it was to get credit without P/G on my first business.

I agree, forming an LLC early can never hurt you. But not forming one early enough can hinder your growth and protection.

I started mine in 2005 and barely used it since I had another full time job. When I finally did start using it more in 2007 we applied for stated loans and our lender told us that the corp being over 2 years old really helped us to get approved. I say start is asap. My two cents...

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I say start it. Once you make it pass 2 years you are good to go. You can even apply for accounts now with your fein to get your credit started once you form your LLC. I stared mine a year ago. I really haven't used it yet but I am getting everything aligned now.Go for it!!

Alot of accts do this because they dont want the extyra paperwork. But Yes you need to incor first to take liablility off yourserlf. A llc is ideal for real estate and you can build business credit and get mortgages under this type.

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Billy Brown
Business Success Academy Founder
Phone 251-272-1111
www.bmcincnow.com