creating an LLC to purchase condo from myself?

[Anonymous]

I own a condo in Arlington that has been renting for the past 7 years.

Is there any benefit to starting an LLC and having the LLC buy the condo? Is there a tax advantage? How could i pursue financing since I don't have the cash to buy it outright? Does this even make sense?

[Anonymous]

No, that doesn't make any sense at all.

And, no, there's no secret tax advantage you're missing out on. An LLC is a flow-through entity. All you'd do is complicate your tax filings (and make them more expensive).

[Anonymous]

As a C corp it might make sense, but would increase your costs. Benefit is then limited by your creativity - I.e. take profits and put them into a 401k, put employer match on top, etc

[Anonymous]

Anonymous wrote:As a C corp it might make sense, but would increase your costs. Benefit is then limited by your creativity - I.e. take profits and put them into a 401k, put employer match on top, etc

Eh. The income would double-taxed. And a 401k plan would have to be administered.

[Anonymous]

The benefit of having an LLC is if it's owned by more than one person, and also to limit liability.

[Anonymous]

The benefit of having an LLC is if it's owned by more than one person, and also to limit liability.

[Anonymous]

A single-owner LLC is disregareded for tax purposes, with all economics flowing through to the owner. So no, it doesn't make sense now. Were you to buy a new condo, forming an LLC with another individual as a 1% owner might offer some benefits depending on how it is structured, but that is CPA/attorney territory.

[Anonymous]

Anonymous wrote:

Anonymous wrote:As a C corp it might make sense, but would increase your costs. Benefit is then limited by your creativity - I.e. take profits and put them into a 401k, put employer match on top, etc

Eh. The income would double-taxed. And a 401k plan would have to be administered.

Yes, it would, but you can then deduct an awful lot more..... So, yes, you "made $50K" lets say, you go ahead pay out $17,000 to yourself as an employee with 100% 401K match, and then do a $30,000 top off as an employer match. Sure, you'll pay some taxes as a result, but you've then taken nearly $50,000 and put it into a tax-deferred account. You can also setup a deferred compensation trust and put your money in there, thereby lowering both your tax burden and your long-term income potential. Once its set up and running its all fairly straightforward, and a number of a companies offer small business 401k plans administration for relatively small amounts.

[Anonymous]

transfer taxes too?