Entity structure - first MHP purchase

[SDGuy]

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Holding company LLC

 I’m closing a couple deals and am wondering if there are any issues with purchasing the properties under my management LLC and then moving them into their own LLCs in a few months. Any tax or major cost implication? How about if I take care of deferred maintenance while the properties are under the holding company prior to moving into their own LLCs? Any problems here?

Subsidiary and Company Structures

The Parent LLC should be set up as the “Holding” LLC. The Holding LLC will own all the Shares in the Subordinate LLCs. Sub A LLC though Sub Z LLC will give Holding LLC a K-1 each year. The SUB LLC will not need to file a tax return as they are disregarded entities. However, your CPA will need to do the books to produce the K-1’s etc. The financials work exactly the same as if you owned the Sub LLC’s directly, with the exception of not needing to file a tax return for each Sub LLC. Since you a…

Separate LP For Each Property?

Jefferson,             Do you have a holding company for all the other LLC’s to fall under?-Merix