LLC title holding.

[badmomma]

Holding a title on property as an LLC is common for those who are looking to avoid some of the Federal Income tax issues.

A limited liability company protects the individual owners from personal liability and for federal income tax purposes those investors can ignore the LLC when they complete their tax returns. The LLC exists but the owners can take the losses and gains from the investment directly on their individual tax returns. For these reasons, most real estate investors choose to hold title to their real estate investments in an LLC.

A person could also put rental realestate under an LLC. You should of course always seek legal advice in areas such as these.

LLCs owned by one individual can be ignored for tax purpose and the rental profit and loss can still be reported on Schedule E of the 1040 federal income tax return. Hence, there should be no additional return preparation expense or accounting fees for using the LLCs.

Now there are benifits to doing this but there may also be some risk involved. Like everything we do we should always seek legal advice before taking any action.