For tax purposes, it is disregarded anyway so it won’t
matter. But, for asset protection if you are
collecting rent directly you are putting yourself at
greater risk than if you collect it in the LLC.
Single member LLCs offer liability protection, but no
asset protection. For clients I generally set up the
LLC with a 99.9% membership in their name and a .01%
membership interest in a relative of friend. This way,
it files as a partnership (less risk of audit) and has
two members so it has asset protection.
I set up a single-member LLC 7 years ago and placed my one rental property in it. I don’t think I’m using it correctly but have gotten mixed advice. The lease is in my own name still and the monthly rent checks are made out to me personally. A buddy told me my LLC is useless this way and I have no protection. Another acquaintance said I’m okay because the title to the property was held in the LLC so it didn’t matter what the lease said or rent checks were made out to. Which is correct? And if I’m using it wrong can I just change the lease at the next renewal and put the LLC name in it?