WHY TO FORM AN LLC FOR YOUR REAL ESTATE BUSINESS:
There are many benefits for forming an LLC for your real estate business particularly that your personal property is not be accountable for business claims and losses. The flexibility of LLC does not require that complex formalities of record keeping of a corporation. It also gives you option to choose how to file taxes. LLC gives the several protections to real estate investor as opposed to other legal entities.
If you set up an LLC to hold investment real estate, you report your LLC’s income and deductions on the 1040 Schedule E form.
BENEFITS YOU CAN GAIN BY FORMING LLC FOR YOUR REAL ESTATE BUSINESS:
Numerous benefits are there if you want to form an LLC for your real estate business.
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Flexibility of profit distribution
- Tax savings: It gives you an exemption in self employment tax that are not available in sole proprietorship and corporations. many independent real estate agents and investors find real estate LLC tax advantages to be one of the most valuable aspects of incorporating.
- Flexible Management structure: the management hierarchy presented by LLC makes it much easier to delegate management responsibilities and positions. LLC is free to be managed by owners or a third party.
- Ownership of an LLC can be easily transferred to other in order to avoid tax burden.
