Should You Move Your Rental Properties Into An LLC?

[@ClintCoons]

Claim Your FREE 45-minute Investment Strategy Session to receive business planning tips and asset protection. 👉 aba.link/3b0c9d

[@shohamsaha1]

Fantastically explained. Concise and to the point. No beating around the bush.

[@ClintCoons]

@shohamsaha1 Thanks for watching.

[@nguye1971]

Great tip as always. Thanks Clint What is the impact on title insurance if transferring the property into an LLC?

[@ClintCoons]

Use a warranty deed and the protection will carry (if title is encumbered before you purchased your LLC will seek recovery through you) but the best method would be to obtain a rider from your title company.

[@zackdaniels5523]

I’m into my first rental property and this is exactly what I needed thank you so much!

[@ClintCoons]

Glad it was helpful!

[@dmez7020]

What if mortgage in personal name? Does this matter? How does irs view an llc doing all the operating while it doesnt own it? Should there be a lease that llc pays to owner?

[@ClintCoons]

It does not matter if the mortgage remains in your name. Everything flows through the LLC to you personally. An LLC operating a property and collecting the income on behalf of the owner is no different than using a third party property manager to perform a similar service.

[@veeradadi5970]

Thank you Clint! What are the alternatives to having a LLC in California for a rental property? Having an umbrella insurance an alternative?

[@ClintCoons]

I would look at a Wyoming Statutory Trust, disregarded LP., or land trust.

[@deancoronado4898]

Is there any reason you prefer starting an LLC in Wyoming vs Delaware or Nevada? I've done some research toward starting several LLC's, and Nevada seems to be the one best suited for my needs, both for taxes and asset protection.

[@ClintCoons]

It is difficult to obtain anonymity with a Nevada LLC without using a nominee manager. A nominee manager can make it difficult to open a bank account for your LLC. I would prefer to use WY or DE.

[@Mich071]

Question: Do you still own the properties after turning them into an LLC and do I retain all rights?

[@ClintCoons]

Yes you do through the LLC.

[@jorgegiraldo4502]

They can still qualify for a non qm cash out refi

[@soolly357]

Should you put in under a non disclosure LLC or just a regulated LLC?

[@ClintCoons]

I do not understand what you are referring to.

[@navidsoroush8777]

I bought a prjmary that now I rent. I have a large umbrella coverage. Do you recommend an LLC for the now rental unit and is there a wallet friendly way of doing so? Does it require transfer of ownership? That’s be at least a few percent of assessed value in my locality. Thanks!

[@esixx17]

Fnma selling guide specifically addresses property seasoning in an LLC when you are the owner of the LLC

[@Alex-gx5mb]

What about the house we live in with no mortgage on it anymore. Should we convert it to an LLC and still continue to live in it?

[@ClintCoons]

Depends on when you turned it into a rental. You may want to sell it to your LLC for some great tax benefits. kzbin.info/www/bejne/g4ipq3R7bNyoac0

[@fanatic4hockey]

Good advice at the end. I need to refinance my FHA duplex. A year passed and have them both rented out now. This mortgage insurance is killing me. I'm also scared to refinance and then move it to an LLC because of the rumored due on sale clause. However unlikely it is, it may still happen.

[@ClintCoons]

Use a land trust to minimize the concern.

[@fanatic4hockey]

@ClintCoons From FHA to a land trust? I acquired the duplex via house-hack, hence the FHA loan. Now, both units are rented out. As stated earlier, I want to remove my mortgage insurance via refinance because I did a lot of work to the home, and I'm sure it exceeds 20% equity because of the rehab. Rates are coming down a little and beginning to re-think of financing. But i also, want to get this into an LLC. Is a trust under an LLC's umbrella?

[@alexseminario190]

Great video Clint! I appreciate all the information! I have a question sir, I have a rental property under my name in California that is paid off and I’m looking into getting a HELOC on it to invest in more real estate . Should I keep this rental under my name for now and hold off on putting in it on an LLC or Would you recommend putting it in a personal living trust. Would a personal living trust give me asset protection? Thanks!

[@ClintCoons]

If you are looking to obtain a HELOC in the near future I would hold off on moving it into any entity because you will most likely need to pull it back out. After you obtain the HELOC I would place it in an LLC that is ultimately held by your living trust.

[@RicardoHernandez-zr1pw]

Why does it have to be Wyoming?

[@RNatelli89]

Awesome video, quick and easy to understand, thank you! Question; If I purchase a property in cash under my personal name, can I/should I refinance under an LLC? Just purchased my first property and I am trying to understand how to set myself up properly moving forward, thanks!

[@ClintCoons]

Depends on the type of loan you are going for. If freddi/fannie conventional then reif under your own name.

[@dmez7020]

Thanks Clint!

[@starmaster9771]

Great Video! are you able to use a Wyoming LLC and get it's benefits even if you and your property are not in Wyoming?

[@ClintCoons]

Yes. The WY LLC offer great asset protection for members (owners).

[@impacttheworld8713]

Thank you for the video! How do I switch property from personal name to LLC? and whats the cost? Thank you Clint!

[@ClintCoons]

You would deed the property but depending on the state you may want to consider using a land trust to avoid transfer taxes. If you would like a FREE 30-minute consultation to discuss your situation in more detail, you can request one here - aba.link/30minSession

[@Coryvdm123]

What if the property was already purchased under the LLC in the first place? 6-8 months the equity increased. A cash out refinance should still be able to happen no?

[@ClintCoons]

Yes but you might have to take the property out of the LLC

[@freedomlife3298]

Hi, Clint. Im wonder, If you have the loan under your personal name, and transfer the title into LLC, how do you pay the loan? Because looks like company shouldn't be paying any personal loans. Also WY LLC couldn't protect your name anymore, because property's loan is under your personal name.

[@ClintCoons]

You can pay the loan from the LLC because the LLC will assume the loan with the asset.

[@toreckman8899]

Thanks. So the tax benefit is because the LLC has a higher tax rate and the 10k is taxed on one’s 1040 via K-1 at a lower rate.?

[@ClintCoons]

What part of the video generated this question? I am unsure of what you are asking.

[@toreckman8899]

At 3:30. You say two reasons why to do an LLC. ‘Taxes and Asset Protection’. My understanding was taxes gave one borrowing power. Hence my understanding being borrowing power and asset protection being the pro’s. I’m failing to understand the tax advantage.

[@SriRam-yq4id]

Great Video and thanks for sharing your knowledge. Will the property taxes go up if I put my existing home into a LLC before converting it into a rental property?

[@ClintCoons]

Not likely but in some states it could and therefore you should use a land trust. If you would like a FREE 30-minute consultation, you can request one here - aba.link/30minSession

[@SriRam-yq4id]

@@ClintCoons Thank you Sir. I called my Title company and they gave clear instructions and forwarded me to a Doc Prep company who will help with all the paperwork. The key thing in California is to form the LLC with the same ownership as the rental property. As an example, if the wife and husband together own a property in their names, they can form an LLC with 50% each ownership and when they transfer the title to LLC the property will not be subject to re-assessment by the County.

[@zillerruss]

Amazing information

[@sbphil33]

Clint where's the link for the 45 min strategy advisory? I've been trying to reach you for sometime. Love your videos. I just have questions and would like to talk over the phone with one of your advisors or you!

[@ClintCoons]

If you would like a FREE 30-minute consultation, you can request one here - aba.link/30minSession

[@RAA3548]

Amazing Video ? If I had the my rental property for 2 years and now 2024 want to transfer into an LLC . If I decide to refi next year will I still have to pull it out from LLC ? Asking because you stated don’t transfer to early. Thank you !

[@ClintCoons]

Yes. Moving in and out of an LLC is typically not an issue, but in some states, it could result in a taxable transfer.

[@RAA3548]

@@ClintCoons Thank You!

[@steverino27]

what if you expect to do a cash out refi 2-3 years down the road?

[@ClintCoons]

I would move it into a land trust and then place the land trust into the LLC

[@lukephelps2735]

Great Content as always Clint - I've tried getting conventional financing on rental properties in the past but have been turned down by several banks because I had 10+ properties owned. They were all owned in my own name, does moving them into an LLC help me out in this scenario?

[@ClintCoons]

No but consider a DSCR loan.

[@lukephelps2735]

@@ClintCoons I think you've previously mentioned a structure where I could get issued a W-2, even though I'd be the sole owner of the LLCs? I've got a Wyoming holding company set up, would taxing it as C-corp or an S-corp achieve that?

[@ClintCoons]

@@lukephelps2735 Yes, if you set up your entity as an S or C and take a salary from the business then you will receive a w-2.

[@dilshod-o7y]

I am buying property soon with cash in Alabama. Why do we have to put the property under disregarded LLC first? Can't I put it under WY LLC straight? Can I refi in 6 months if done straight under WY LLC?

[@ClintCoons]

You could but if you are renting be sure to use a PM.

[@chrislebas1618]

I'm not clear on the second LLC. I dont understand why have the Wyoming LLC.

[@ClintCoons]

Anonymity, asset protection, asset consolidation, reduction in the number of tax returns, ease of transferability...

[@andres_does_rentals]

@@ClintCoonshow do you get the Wyoming holding company to own the LLC on the rental? And do you recommend getting one LLC per rental?

[@BTCnREI]

Very informative! Good stuff. Thank you Sir!

[@ClintCoons]

JR D Thanks for watching.

[@richardtruitt4646]

for the Wyoming LLC to be taxed as a partnership, don't I have to have at least two members? so do I list myself individually and also my trust or another LLC as the other member?

[@ClintCoons]

Yes you need two members but it can not be you and your trust unless your trust has a second beneficiary.

[@The.blondest_brunette.]

Good afternoon Clint. FANTASTIC videos and new follower here, Thank you very much! I have a question for you. I'm on the process of closing our first rental property (Airbnb, Verb, etc)in a week. We got a Conventional loan but want to change it to a LLC. How long do I have to wait after closing to change it? Thank you so much.

[@ClintCoons]

I would wait a month and use a land trust into a LLC.

[@The.blondest_brunette.]

@@ClintCoons Thank you so much I really really appreciated and can you change it into a land trust even if is a condo? Thank you again and what State are you located it?

[@ClintCoons]

@@The.blondest_brunette. We have offices in WA, NV, UT, and WY

[@olearysteve04005]

With a llc, do we pay fica social security? Currently, I don't. Also, I live in the multiunit. Does this matter?

[@ClintCoons]

Only if you are running an active business.

[@elijahliam4999]

Hi, thanks for your videos. I got a question.what if I only want to use an LLC name for my daughter's vehicle since she is still a young adult. .but no income for the LLC name, it's just for limited liability for the car she drives but I don't use the LLC name for the assets we have nor trying to claim any tax deduction at all for the car use.In this case, can we open an LLC name just for her car in case accident happens? In other words, we are only opening a LLC name just for her car tile. No loan on the car, just cash purchase. thanks

[@ClintCoons]

Great question, to assist you further, I highly recommend you request a free 45-minute consultation to discuss this with my team so we can provide you with an answer that is unique to your situation. Visit: aba.link/3b0c9d

[@mmdwyertravel]

Hi Clint- thanks for the great videos! These have been tremendously helpful. If I have a conventional mortgage on my rental investment, am I allowed to change the title / deed to my LLC (if I am the only member of the LLC)? Or, will that trigger cash due on sale (i.e. will I have to pay off the mortgage)? This is something we've had trouble finding clarification on.

[@ClintCoons]

If it is a freddie/fannie underwritten loan it is allowed. Another option is to use a land trust and place the land trust in the LLC

[@stanmoney8470]

My exact same question ⁉️. I was told the mortgage company could ask for the money up front if you move a home in your personal name into a LLC

[@musictosoothe]

If property is already titled in a living trust, can it be put into an llc?

[@ClintCoons]

Yes it can

[@musictosoothe]

Thanks much!@@ClintCoons

[@cheribarker1870]

Why Wyoming?

[@rb7454]

Because the state laws of Wyoming allow you to have anonymity . It’s gives the best protection. Delaware and Nevada have other advantages.

[@ericgulick2749]

God bless my Wyoming

[@Acclvr]

Just to be clear. If I want to refi and use equity. I wait 6 months, then refi? Will the bank be ok with me switching it over to an llc after I’ve used it to refinance to get equity money to reinvest in another property?

[@ClintCoons]

Yes if it is a conventional loan.

[@khackney86]

Clint you are the man

[@ThirdHorseman]

You could just get a DSCR loan to utilize the properties income as opposed to personal debt-income. Also in CA and other states a single member LLC it’s a pass through on your taxes. So no K-1.

[@ClintCoons]

Correct

[@sonnystop]

With only 1-2 properties in texas does it make sense to LLC?

[@ClintCoons]

Absolutely. Ask yourself this - if someone was injured on a property or you are sued personally, are you comfortable with all of your assets being at risk?

[@stanmoney8470]

Can't the mortgage company ask for there money up front if you move the home into a LLC?

[@ClintCoons]

Yes if you are obtaining a new loan.

[@AGILISFPV]

What changes when talking now about commercial real estate rental properties nstead of residential rental?

[@ClintCoons]

Changes will depend on how long you plan to hold the property. If you would like a FREE 30-minute consultation, you can request one here - aba.link/30minSession

[@JMIJMI-p4t]

What if i don't want to refinance now but maybe in 2-5 years? Then it can be a problem to do that if I moved it to an LLC and put that llc under Wyoming llc?

[@ClintCoons]

No you will pull the property out of the LLC prior to the refi.

[@Metaman9000]

Great video!

[@ClintCoons]

Thanks!

[@chrisrojas7521]

Question on the Cash Out Refi in an LLC. You mentioned if i plan on doing it within 6-12 months its not a good idea. Well, if i wait longer maybe 18-24 months, will it work out?

[@ClintCoons]

Yes that is fine.

[@anujanshankaran8577]

is it a good idea to rent your house to a company which wants to house consultants

[@ClintCoons]

Depends on the $$$.

[@abdullahmuhammad399]

Hi, i jave a question. Iam buying a property with 3 people, is it a good idea to buy it as a company or individual. ?

[@ClintCoons]

Buy it as an LLC meaning at lease hold your interest in an LLC. Another consideration is a tenant in common agreement depending on the value of the property. If you would like a FREE 30-minute consultation, you can request one here - aba.link/30minSession

[@structuresspecialist9743]

When preparing deed for transfer into LLC, what is the consideration amount to put on deed? $1 or a realistic sales price?

[@ClintCoons]

$1 and other good consideration is typical

[@structuresspecialist9743]

@@ClintCoons Does $1 undermine the goal of anonymity? It is apparent that you are transferring the property to your LLC rather than actual sale to 3rd party. Is my thinking off?

[@ClintCoons]

@@structuresspecialist9743 Many deeds do not recite the consideration paid for the property. $1 is a common practice.

[@texex9251]

My lender on my rentals will not allow me to move more my properties to an LLC. I was told by my lender that as soon as I change the ownership title to the name of the LLC they will call the loan due in full. I can't refinance with another lender as my interest rates are below 2.5%. Do you have any suggestions?

[@ClintCoons]

Sounds like you have a portfolio loan secured against multiple properties. Is this correct?

[@TEXASdaughter]

Going by the rules of Social Security, you are penalized for earning a large income, by selling a house or property, in one year. Will having an LLC stop that from happening, by putting real estate into it and not in your name?

[@pablobarrerarowley2188]

That was kind of confusing. You stated the argument as owner and as a rental property. Even though they can be put both independently under your LLC there are deferent consequences and procedures. I think that's something that need to be clarified. Other than that, that's a good stuff.

[@johnyoung1095]

Hey Clint - videos are awesome. I have 3 properties that I own in my personal name. I'm in the process of a cashout refi on one of the properties that will allow me to payoff the other two mortgages. I believe using the llc loan to pay off mortgages in my personal name will trigger a taxable event for me. Do you have any suggestions how to accomplish moving the property to the LLC and paying off the other mortgages?

[@ClintCoons]

Land trusts all the way.

[@PursuingTheBest]

Great videos Client. Quick question, Can I stay in my own investment property when not renting it out? Are there any restrictions on this? Ie… if we rent out property for 6months of the year and want to stay in it for 6months are selves. Any depreciation or other tax impacts if allowed to stay in it ourselves?

[@ClintCoons]

Yes you can stay in it but the tax deductions will be limited because of your use.

[@KarlChristofferson]

very good information. I have a question. If i buy a property with 25% down payment. The 25% is after taxed money. Can i get my down payment back with rents? what if i borrowed the money from family, i wouldnt want to pay family back with rent that has been taxed a 2nd time.

[@ClintCoons]

The rental income is taxable but depreciation can offset most of your taxable income. The repayment of principal to your family is not taxable.

[@jakedecker3581]

Hey Clint, Question about the ReFI: If I know that I’m going to ReFi my property in the next 12 months so I don’t move my property into an LLC… can I still open an LLC and run all income and expenses through that LLC for tax purposes? Even the LLC doesn’t own/hold the property?

[@ClintCoons]

You could but it will all flow to your 1040. The LLC is just a conduit. If you are thinking you can have the accounting done at the LLC level and keep it off your return that will not work because you are the owner of the property.

[@aminsalehi6323]

Hi Clint, Thank you for putting out great contents. Do you have a recommendation on how to put rental properties into LLC and avoid transfer tax? you have talked about using land trusts in your other videos, but some states like Pennsylvania are not trust friendly and you still need to pay 2% transfer tax even using land trusts.

[@ClintCoons]

You execute a deed but do not record it. It is the recording that triggers the tax. I would then run all the rents and expenses through the LLC. The mistake many people make is thinking a deed must be recorded to make the transfer effective. Recording is not a requirement to transfer real estate.

[@theofficialgaro]

@@ClintCoons so what you are saying that it does not matter if the lender allows or not to transfer the deed to a LLC. This can be done without recording? Who transfers the property deed to the LLC without recording? A lawyer, an accountant, a title company?

[@ClintCoons]

@@theofficialgaro All you need is someone to prepare the deed. Either of the parties you mentioned can prepare a deed (maybe not the CPA)

[@g9351]

I watched your other video. When the charging order from the rental property occurs, then you have to record the deed to LLC and pay the transfer tax immediately. My question is " What's the role of the Holding LLC in this"?

[@ClintCoons]

@@g9351 Anonymity for the property holding LLC

[@letsplaymusic817]

Does the Wyoming llc remove the tax by partnership with them or do they cause it to be underwritten

[@ClintCoons]

I am not sure. Could you restate the question?

[@romegq]

Happy New Year Clint. I enjoy your videos, please continue the content. Question, with regards to a rental in the states of PA and CT, is you're company available to place that also into a Wyoming LLC?

[@ClintCoons]

Yes, absolutely

[@romegq]

@Clint Coons Esq. | Real Estate Asset Protection thank you for your prompt reply. I'll definitely contact the office this week!

[@letsplaymusic817]

So a Wyoming llc helps you build a platform that is impressive to lender , correct me if I am wrong. What does the Wyoming llc do , a bit confused there.

[@ClintCoons]

The Wy LLC builds anonymity and increase asset protection but it may not help with lenders.

[@jackdaylon]

You mentioned the six month seasoning period, however if the property is pur chased under an LLC with an all cash offer (not using any financing) is this still subject to the six month seasoning period?

[@ClintCoons]

Depends. Freddie will allow tacking of ownership if you need to pull it out of an LLC but some lenders will not follow this guidance. If you refi in the LLC not an issue.

[@g9351]

Hi Clint, Thanks for making excellent videos with great info in real estate management. Is it a good idea of having an established Holding LLC own multiple properties first and deed transfer to each sub LLC when it's created? What are the pros and cons in this?

[@g9351]

I believe a lot of people have had numbers of rental properties in one LLC, but now they want to create new sub LLCs to own these rentals separately after watching your videos. Is this having some tax issues?

[@ClintCoons]

The problem with the holding LLC owning the real estate initially then deeding to the sub LLCs is you will lose any anonymity because you will sign the deed as the grantor (on behalf of your holding LLC). Second, in some states there may be a transfer tax from LLC to LLC so this would make it more expensive to take this approach.

[@ClintCoons]

I would use land trusts and assign the land trusts to the new LLCs. I have a video on land trusts uses that covers this strategy.

[@alirezashahabi5759]

Thanks for the great video Clint! A main question is can the lender stops me from moving my rental into an LLC? I buy my rentals as owner occupied to take advantage of lower downpayment and lower rate, but what would the bank say if I move it to an llc? or how long after I buy the property I can move it to an llc without triggering rate hike?

[@ClintCoons]

No the lender can not stop you. If you buy as owner occupied you must wait 1 year to fall under the Freddie Fannie "due on sale protection". I would consider using a land trust then assign the land trust to an LLC as a work around.

[@meraindia5367]

Sir, I'm planning to buy a 2 unit rental which is owned by an LLC for around 1.2 Mil, I'll 100% of the interest in the LLC Will there be close cost for this transaction? Like mention tax, title fee etc?

[@ClintCoons]

Are you buying for cash?

[@meraindia5367]

@@ClintCoons no, seller financing 100% Thanks for the quick reply :-)

[@TaVarezCampbell]

What if I own a very small fleet of rental cars and want to partner with someone who has the same. Would our disregarded LLCs form a 50/50 LLC?

[@ClintCoons]

Yes you would form a joint venture

[@bearshares]

When you speak of moving a rental into a State LLC (same state as property) you, of course, are referring to "deeding the property" over to it. In lieu of that, couldn't I just create a new LLC at the management level? Meaning, setting up a new entity (such as a property management company) at the state and federal levels, and then create an agreement between me, the property owner, and the management entity? This entity would be responsible for managing or leasing the property, effectively shifting the responsibility away from personal assets. All business transactions, such as lease agreements and contracts, could go through the management LLC, providing a layer of protection?

[@ClintCoons]

Yes you can do as you say but if someone is hurt on the property the property owner is ultimately liable.

[@mattjacobson2418]

Thanks a lot Clint for the video, Regarding transferring Title from your personal name into an LLC, I see how Fannie/Freddie are now allowing this transfer, assuming the original borrower controls the new LLC. Is it permissible for the new LLC to be controlled by a new parent LLC, which is then in turn controlled by the original borrower?

[@ClintCoons]

That is my interpretation.

[@calivalley9056]

Do you need file state taxes in Wyoming if you establish LLC there or in home state?

[@ClintCoons]

No you do not

[@jeanettestandard3832]

I can wait to start investing in tax deeds and liens so I can have you guys help keep me protected and aware I just love the content your awesome

[@ClintCoons]

Jeanette Standard Thanks for watching.

[@kingmode4]

what is a Wyoming LLC or is that just an example of another LLC

[@ClintCoons]

It is an LLC set up in Wyoming to benefit from Wyoming's asset protection and privacy laws.

[@kingmode4]

@@ClintCoons appreciate that!

[@masscomnet]

Hi Clint, really appreciate your video. I have "heard" of people selling back investment properties held inside LLCs (to themselves) for a $1. Is that real? If so, what's the benefit?

[@ClintCoons]

Not sure why someone would do that.

[@masscomnet]

@@ClintCoons I think the purpose was to use an S corp structure to deduct purchase / remodel expenses from personal income . . . then convert to C corp, and sell it back for $1. Please pardon me for this if it's silly or not legal. I am just recounting what I overheard.

[@candycane4852]

Las Vegas NV is a rip off for LLC I use to have one

[@j.l.salayao8055]

How and what was the situation? I live here in Boulder City next to Henderson and will be doing LLC down the road. Thank you for your input in advance.

[@worldwideachievers1234]

Great video Clint. Question: I own a property in Texas. Are you saying to put property in Texas LLC and then put that LLC in a Wyoming LLC? Question: I’m applying for SBA loan and they will place a lien on property if we’re approved. Should I wait until SBA loan is approved before placing property in a LLC or would bank 🏦 even allow us once lien is on property? Thanks Clint and keep up the great work

[@ClintCoons]

Ask the lender. Most of the time you will be ok to close in an LLC but check before hand.

[@Phrozen716]

What’s a Wyoming? .. llc

[@ClintCoons]

An LLC set up in WY

[@truthalonetriumphs6572]

This is not an Ad for Wyoming LLC

[@BerthaClare-o2n]

West Common

[@candycane4852]

How about divorce ? Well once I hear the whole thing you might mention it

[@truthalonetriumphs6572]

Stopped listening after the 5th "Wyoming LLC " 😂 What a pain. I came here to learn about LLC benefits, not to be brainwashed into WLLC.

[@masonjeffers]

What's wrong with Wyoming LLC s?

[@sso9442]

Informative but would you mind writing legibly on your board. Not helpful if no one can possibly read your scribble.

[@ClintCoons]

I am working on that. 😄

[@sso9442]

@@ClintCoons Thanks for being a good sport about the feedback. I had a former boss who did the exact same thing and I could never understand his diagram when I went back to look at it after he left the room.

[@melhoresprodutos8899]