Becoming a Businees with rentals - Posted by Sam Campbell


#1

Posted by Rob FL on December 09, 1998 at 06:17:35:

My personal OPINION is that your accountant is incorrect. If you have 6 you are definitely ready. It only costs about $100-150 a year (in FL) to run a corporation above what it costs to run a sole proprieter, and the liability is dramatically lowered.


#2

Becoming a Businees with rentals - Posted by Sam Campbell

Posted by Sam Campbell on December 08, 1998 at 10:58:29:

I had read somewhere, that after a person rents out a certain number of residental properties, they can somehow become a business, desired for tax benefits. If I remember right, the number was 3 or 5. I was just wondering is this the number of buildings or apartments? Right now I own one building, an old house, that is one apartment upstairs and one apartment downstairs. How would I count this towards the number refered to above? What is the number in question above, 3 or 5 or ? What would be my next step towards starting an apartment leasing business?


#3

Re: Becoming a Businees with rentals - Posted by Carl (IL)

Posted by Carl (IL) on December 08, 1998 at 23:39:41:

Really, you can start a business even if you don’t own any property at all. However, at some point, (varies from person to person), the costs of starting and maintaining a LLC, S-Corp etc. are less than the tax advantages of having such an entity and therefore, would be desireable to create, (this speaks only from a monitary perspective, corporations also can add a layer of protection from liabilities). Alot depends on your current income from other sources and what other write-offs you currently have. I currently have 6 properties and am getting close to where I should establish a LLC or S-Corp, (I am currently DBA, “doing business as” which still lumps my business and personal taxes together). This topic comes up at my semi-annual reviews with my accountant where she, so far, does a flurry of calculations and says “your not ready yet”. I suggest you consult an accountant for your particular situation.