Starting a LLC for Real Estate investment properties.?

If I live in California and am purchasing an investment property out of state and want to put it under an LLC do I need to create the LLC in that state or can it be made where I reside (California)?

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  • 1 month ago

    IDK but I thnk they are like 800 bucks a year to do in California, SPENDY!!!

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  • 1 month ago

    You can create it in either state.  However, if you don't create it for the state you live in, then you will have to pay state income taxes for both states (where you live and where the LLC is set up) and you will have to maintain a presence in both states or else hire a registered agent for the state where the LLC is set up (again this is only required if you have no presence in the 2nd state and thus can't act as your own registered agent).  

    Many people will set up the LLC for a state with very low taxes (like Nevada, I think).  They find that even if they need to hire a registered agent in the 2nd state, they still save money due to the lower tax rate.

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  • ron h
    Lv 7
    1 month ago

    I think I'd talk to a CA tax attorney for advice. Also, be aware that a LLC will NOT protect you from the mortgage contract if you plan to borrow money.

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  • 1 month ago

    Since you are operating from California, you will owe California business tax and income tax regardless of where the properties are located. 

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