Posted by Alex F. (CA) on May 19, 2003 at 24:52:21:
Hi,
I just incorporated under a LLC in California. I paid around $1,500. There have been many discussions about this on the board, so just type in “LLC” or “Corporation” in the archives. There also is an article from this website about incorporating. With all of this info., you should be able to find the answer yourself. Overall, I’ve heard and learned if you’re buying & holding real estate (like I do) then you should be a LLC, while if your flipping multiple properties, you should have a S corp. I have my 7 properties rolled up under my LLC.
I am an agent/investor looking to Incorporate. What type of Corporation should I be involved in if i am going to start a corporation. S Corp or and LLC? My primary business will Be Real Estate, but i am also involved in diamond selling, and selling products like: vitamins, laundry care, skin care etc.??? When incorporating, do i obtain Corporate credit w/credit? bank accounts? does the corp have it’s own tax id #? just asking? very new to Corportations as you can see…
Since you say that you also sell vitamins, laundry care, skin care, etc., I’m guessing maybe you’re doing MLM. If so, you have all sorts of tax saving opportunities, but you have to deal with an accountant that really knows what they are doing. Before you set up your business structures (i.e., S-corp, C-corp, LLC), find an accountant that knows what they’re doing when it comes to REI and MLM. A challenge, but keep asking until you find someone. It’s much more important that you do it right, than that you do it fast.
Diane Kennedy, CPA, is one of Robert Kyosaki’s (Rich Dad/Poor Dad fame) advisors. (Personally, I am not a Kyosaki fan, but she impresses me!) She has written two or more books. Get them. Read them. Study them. What she says is much more informative and understandable than anyone else I’ve read.
Also, she was a guest on David Finkel’s online radio show on August 19. She was outstanding! Go to wsRadio.com (the same site that JP’s and Terry’s radio show is on) and look under real estate on the left. You’ll find David’s show. Go to his archives for August 19. Listen and learn.
Couple of suggestions here to help you get the info you’re seeking. Check the RE Legal section of this site. Books stores carry a good selection. There are several good books that will get you excellent info on business entities (LLC is not a corporation), Nolo press (nolo.com lots of free info there) has a good selection along with other publishers; there are several attorneys associated with this website, check what they suggest, or check your local library.
Also, check with a CPA as taxes are one of the important elements of a business structure.