How to Collect Rents with an LLC
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- เผยแพร่เมื่อ 24 ส.ค. 2024
- How to collect rents with an LLC (Limited Liability Company).
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Clint Coons, Author, and Attorney provides real estate investors detailed knowledge of how to best structure rental real estate using an LLC to collect rent.
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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. of the information contained herein without seeking professional legal advice.
Clint is fkn dope. Hes a good man. I'm new to CRE and enjoy Clints lessons and comm style. Great tone and speech patterns.
Thanks! We think Clint is pretty cool too.
Hi Clint...really like your videos, questions, in the bank account setup as explained above, how do you pay for expenses for each property (mortgage, utility bills etc), from the AZ, Texas account or from the holding WY company?
You pay it from the bank account linked to that particular LLC (AZ, Texas..)
Super Clear. Thank you so much for adding value to so many.
I appreciate you watching and your comments. Thank you for taking time.
In this structure, would it be beneficial to be taxed as a corporation and then become a W-2 employee?
@ClintCoons what if properties are personally owned how should money flow for tax purposes ?!?
Hello Clint, I'm am currently renting from a home owner in Tucson Az. The property is registered through an LLC, yet the owner is having us pay him directly. Is this wrong?
Not necessarily. It's better to have tenants pay the LLC in order to maintain anonymity as the homeowner, but it is not inappropriate.
You suggested setting up a mgmt company to collect the rents. But I've read that unless the principle owner of such a mgmt company is a licensed RE Agent, it would be illegal to manage rental property that it doesn't have a majority ownership interest in. Is that true? If so, how do you suggest dealing with that in the anonymity/asset protection scenarios youve laid out in your videos? I'm in Missouri in case that matters.
In CA, yes it's true that a RE License is held by the management company. To manage your properties, collect rents, do repairs, rent vacancy.
The property manager company deposits all revenue, and pays for sub contractors, and collects their agreed upon contractual fee, monthly.
Very helpful! I will be subscribing and supporting you.
At what point are taxes paid? When money is moved from LLC to holding? Or at personal level. What if I decide to leave money in LLC and holding company
If your Holding LLC is a disregarded entity for tax purposes, then the income and expense will be reported on your personal 1040, Schedule E. The income "flows through" to you personally so it does not matter if you keep the money in the Holding LLC account or take a distribution.
Problem is that Wells Fargo and B of A doesn't pay reasonable interest on the cash deposited on your holding LLC.
Unfortunately, no. Interest rates on regular checking and savings accounts are not very high at the moment. However, you do not need to hold the cash in your holding LLC. You can use it to invest in more rental properties or other assets and expand your investment portfolio.
Can you also call when you need money an owners draw?
very thorough, thank you
I'm wondering if centralizing the money into the holding company is negating the whole reason to have a LLC, which is limiting liability. After all, if the holding company owns 100% of the Texas LLC that owns a building, and that TX company gets sued, they'll just follow the trail to sue the holding company, as the full owner, and since you put all money into that holding company - they have deeper pockets to sue.
The holding company doesn't do any business activities with the public whatsoever; therefore there is no legal ground to stand on when you try to sue it. OR you can own the 5% and let the holding company own 95%. Either way u can't get to the holding company without doing any business with it
my thoughts exactly
@@jermonecarter6027 that's a great point. That's why is very important to form the holding LLC in a state that has strong charging order protection.
I understand the structure you are showing. My question is how do you fund your Wyoming LLC. Can you deposit funds from your personal acct to WY LLC while still maintain annonimiity
Yes, he said to take all of your personal savings and put it into the WY LLC for asset protection
Great info, thanks 👍🏾
How difficult will it be to open a bank account for a Wyoming LLC in another state, eg NC? Thanks in advance.
So if I have a MANAGEMENT COMPANY, would my LLC own it or would my Wyoming Holding own it? And would tenants pay the Management Co. Which flows down to your LLC or to Wyoming holding? 🤔
The management company's structure will tailored to your particular situation. Please give us a call so that we can set up a structure for you. Thank you.
So how does the Tenet pay the LLC ??? Check,Card how ?
Are those 3 LLCs Disregarded Entities? Is the Wyoming LLC (holding LLC) a Disregarded Entity?
Awesome! Thankyou!
How does one keep anonymity when your signature shows up on documents and paper trails of subsidiary LLCs?
Anonymity is about keeping your name out of public records so people cannot determine how wealthy you are from a public record search. Bank accounts, signing IRS documents, signing internal documents are not public records.
How are leases signed with the LLC to keep your name off?
Use an agent : )
You will sign the lease with your name, as the manager of the LLC. So, for example, "Dirges in the Dark, Manager of Rental LLC".
@@TobyMathis when signing a lease as the manager of an IL Series LLC would I also need to specify the cell particular to that lease in my signature? Or just... Name, Manager rental LLC as above?
Does Wells Fargo allow accounts to be opened online? Thanks
If I have Wyoming LLC setup as partnership with two members. This owns a Texas series LLC. Now, I need separate tracking, for Wyoming LLC, Texas series llC (Master) and each cell of Texas series LLC. 3 levels here. So, could I setup Wyoming LLC company file and Texas Series LLC (master) as class and Texas Series LLC cells as sub classess? Does it let me track all 3 levels? Also, I have one bank accounts for Wyoming LLC and one bank account for entire series LLC. Would the setup I proposed handle handle the my two bank accounts explained earlier? Please let me know
Hello Clint, How do I get the rental payments into the LLC bank account electronically? I Just turned a rental property I had into an LLC. I have asked tenants to pay by paper check, written to the LLC. Previously they sent me a venmo payment or paypal. It seems my bank or maybe all banks do not accept electronic Zelle payments directly. A tenant's Bill pay function for online banking is still a Paper check that the bank issues and sends by snail mail which can get lost. Is there a better electronic method? Can I set up a venmo account in the name of the LLC without breaking the protection of the trust.?
Please clarify, so bills for each LLC Can or cannot be paid at the LLC level? Or should you pay for expenses at the holding company level ie: yard maintenance, insurance etc
Either works - the idea is it all ends up on a single return.
@@TobyMathis i definitely need help setting up business accounts for my 2 llc and do i set one up for a property that i have sitting in a land trust?
Great explanation! Would I still need a Holding Company if my owner information on the rental LLC is not listed with the Secretary of State? Also, can the associated checking account for the holding Company be any bank? I'm trying to avoid having yet another bank outside the Holding Company bank to reduce money movement.
It depends on your state LLC laws and your comfort level with risk. We like multi-jurisdictional plans and sole remedy states. Yes on the bank account.
thx a lot ...really
What are the benefits (if any) to utilizing a program like QUICKBOOKS to track rental income, expenses, etc if my rental property is in my personal name ? I am unable to transfer the deed ...
QuickBooks over rated.
This is the kind of shit people wind up doing when there's too many goddam lawyers in the world
can i open a bank account in the Wyoming llc if i live in texas ?
Yes, you can.
Hi Clint and Toby, how would this work if one of my properties doesn't have an LLC and is just in my trust? Do i open an account for that?
That will depend, is this property going to be rented out? Because if it is then it will most likely be best to not have it be in your living trust.
With this structure, and for simplicity purposes, would it be ok and legal if the tenants from all the different LLC's pay rent directly into the holding LLC?
That wou!d negate the purpose of the holding company wouldn't it? The holding company doesn't do any business. it just holds assets.
Hi Clint.
What if I don’t live in Wyoming, how should I handle the state I live in?
Hello Nelson, you do not need to live in Wyoming to be able to take advantage of the benefits that having a Wyoming entity can provide. I would suggest having a one-on-one consult with one of our Advisors though so you can discuss options and solutions that best work for you. andersonadvisors.com/
Question, open an LLC in my city Los Angeles and then open another in Wyoming I have to pay to secretary of the state here around $850 Per year and another $850 to the LLC in Wyoming
Im renting my house only to pay the LLCS, Doesn't make sense to me Please advice me thanks
You are correct that if you are a resident of California that California will want that $850 for Wyoming LLC as well. California is not very business friendly. We do have some additional strategies that may help you that involve land trusts, but you should really have a free one-on-one consultation with one of our Advisors so we can get the specific details and suggest an individually tailored plan that will best suit your needs. We have lots of California clients facing the same issues as you. andersonadvisors.com/
Do you recommend Regular Banks or Credit Unions for the Holding company?
IANAL but since the holding company is a business I believe that you can create a business checking account for it at either a "regular" bank (e.g. Chase, Wells Fargo, Bank of America, Citibank), or at a credit union --- as long as your credit union allows you to create business checking accounts (some credit unions don't).
I would like to know his thoughts on this as well.
Can any of this be considered money laundering ?
No, we practice law and put a great importance on following the rules in our organization.
Can I start a holding company without the other LLC's? I'm looking to start owning real estate, but because the market is so hot right now, it's hard to find a good property.
I wanted to open the holding company now, because that could set some banking history and potentially generate some credit..
thanks in advance for the reply!
We would like to direct you to andersonadvisors.com/ss/
where you can sign up for a free 45-minute consultation. In this session, you will meet with a professional who will be able to answer your questions regarding this topic.
Overkill. I assume this video is geared towards extremely high asset individuals who buy investment properties all cash. Because it's totally Irrelevant unless you have tensof millions of dollars sitting in the bank and buy your investments all cash. Then you can afford high priced attorneys and cpas to do you bidding. In all seriousness what bank lends to an out of state anonymous "holding company"........... Exactly. Way over the top for your average investor who finances most of his/her properties. I have all my properties in seperate llcs. Nothing anonymous. Been sued several times. Even had a slip and fall death unfortunately. Insurance settled for big money. No they didn't come after me personally. Just have good insurance. No need for overpriced attorneys and overkill.
Hey how did you move your properties with mortgages to a seperate LLC?
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