Wyoming LLC creation for real estate

[wonderd4]

Hello everyone. Looking to figure out the best way to create an entity that will be used for real estate.

I'd like to have protection and anonymity and I'd like to do it myself it possible. I understand if I don't live in Wyoming I will need a registered agent. I've found some for about $25 per year.

What I would like to know is it possible for me to form a Wyoming manager owned LLC completely undisclosed where I am the single manager?
*I've seen a couple law firms advertise this where t
hey become the manager of the LLC during creation, then after creation make me the "undisclosed manager". I'd like to know if Ii can do this without a lawyer and if it would still have the same anonymity.

The Wyoming LLC will own other LLC's that I actually have real estate in. How should these LLC's be taxed?
*I'd like to prevent a schedule E that shows all my properties on my tax return. I heard that there is a way to have all the other LLC's flow to the main Wyoming LLC and produce a single K1 that I file on my tax return, but that is taxed as a partnership. Can the Wyoming LLC be taxed as a partnership with only one manager (ME)?
*I'd like to do everything I can to prevent an audit.

This is for multi-unit commercial properties.

Appreciate any input.

 

[Taxing Matters]

Hello everyone. Looking to figure out the best way to create an entity that will be used for real estate.

I'd like to have protection and anonymity and I'd like to do it myself it possible. I understand if I don't live in Wyoming I will need a registered agent. I've found some for about $25 per year.

Understand that if your LLC does business in any state other than Wyoming the LLC will need to registers as a foreign LLC in each state in which it conducts business. Foreign in this case means an entity that is created in any state other than the state in which it is conducting business. Note that your management of the LLC is considered to be conducting business, so you would need to to register the entity in your home state, too, as a foreign LLC. For this reason, it is usually better and more economical to organize the LLC in state in which it will actually conduct business.

What I would like to know is it possible for me to form a Wyoming manager owned LLC completely undisclosed where I am the single manager?

Sit down with a few business lawyers in Wyoming to determine your options. There are several things that might be done. But understand that it will not be possible to completely prevent someone from finding out you the owner/manager of the LLC. What is the reason that you want the anonomity?

The Wyoming LLC will own other LLC's that I actually have real estate in. How should these LLC's be taxed?

If you are the only owner of the parent LLC and the parent LLC is the only owner of the the subsidiary LLCs and assuming you are a U.S. citizen or resident then for federal income tax purposes all the LLCs are disregarded and the income from all of them is reported on the Form 1040 as though you owned all those properties directly. So each property would be shown on your personal return on the Form 1040.

*I'd like to prevent a schedule E that shows all my properties on my tax return. I heard that there is a way to have all the other LLC's flow to the main Wyoming LLC and produce a single K1 that I file on my tax return, but that is taxed as a partnership. Can the Wyoming LLC be taxed as a partnership with only one manager (ME)?

You can’t do it as a partnership, but you can have the parent entity elect to be taxed as a S-corporation if you are a U.S. citizen or resident. That would means the parent entity files a Form 1120-S and the details of the properties will appear on that return and the S-corporation would then give you a K-1 that you use to prepare your own return. The problem with this is that it might limit your ability to use losses. Again, though, I have to ask why you don’t want all the properties showing up on your return? Are you trying to hide assets from a spouse or ex-spouse in a divorce? Trying to hide assets from someone to whom you owe child support? Trying to dodge some other creditor? Or something else? Depending on the answer you may find that trying to hide the details won’t work very well.

*I'd like to do everything I can to prevent an audit.

Why? If you report everything accurately as you should, then (1) your audit risk will generally be low unless your activity is unusual compared to other businesses in the same industry and (2) if you are audited you won’t end up owing anything.

 

[wonderd4]

I've been listening to much to this guy on youtube. That video is what is causing me to ask all these questions. I am looking at a couple multi-unit real estate properties in different states and I'd like to have the legal entities set up before submitting the formal offer.

I am looking at a property in Florida and North Carolina. I believe the "plan" would be to create a member owned LLC in each state I purchase property in which case the Wyoming LLC would be the member of the other state LLC's

* No spouses. And yes I am US citizen in NY. I'm not trying to hide any assets at all. I just don't want to be targeted for owning multiple properties like suggested in the video.

 

[FlyingRon]

And ask yourself, what is the LLC going to do for you?

Nobody is going to lend money to an assetless LLC. A single member LLC isn't going to offer much protection against liability. For taxes, it's entirely disregarded.

 

[Taxing Matters]

I've been listening to much to this guy on youtube. That video is what is causing me to ask all these questions. I am looking at a couple multi-unit real estate properties in different states and I'd like to have the legal entities set up before submitting the formal offer.

https://www.youtube.com/.....

I didn't watch all 37 minutes of it. But I watched part of it and at the start he makes the assertion that the owner of the LLC could not be identified if the right jurisdiction is chosen. However, I disagree with that. It can make it a lot harder for the general public to find out who the owner is, but in his example of the accident at the night club a determined plaintiff will be able to get that information, it just takes some investigation and serving the proper subpoenas to do it. So if your goal is to avoid that scenario I think (from the part of the video I did see) that he’s overselling the anonymous aspect of this.

I will agree with him that for a single owner property investing business a LLC is a good choice to use. And often using several of them, say one for each property or one for each state in which you own properties, can be useful too. But the more LLCs you have, the more complexity, fees, and administrative burdens you have, so you need to consider all that in deciding just how many entities you will want to use. And if you have several of them, having a master (parent) LLC to manage them can sometimes be useful, but that depends on the details of your operation.

I am looking at a property in Florida and North Carolina. I believe the "plan" would be to create a member owned LLC in each state I purchase property in which case the Wyoming LLC would be the member of the other state LLC's

I you do it that way and the ONLY thing the Wyoming LLC does in those other states is own the member interests of the subsidiary LLCs then the Wyoming LLC would not be required to file as a foreign LLC in those states. But it likely will still need to at least register as a foreign LLC in the state in which you manage the Wyoming LLC.

No spouses. And yes I am US citizen in NY. I'm not trying to hide any assets at all. I just don't want to be targeted for owning multiple properties like suggested in the video.

Then I suggest first that your best protection from the accident scenario he starts with in that video is having sufficient insurance on the place. Second, I suggest you not rely on videos or internet message boards for advice on how to best set this up. Instead, meet with a real estate attorney or two in the states in which you intend to invest in these properties for advice. Each state’s law is different and you need advice specific to the state where you have the property to get the best results. The attorneys fees you pay for that advice are either tax deductible or can be capitalized and those fees are a good investment in your operation as it is the best way to insure you get it right.

 

[wonderd4]

Thanks for the info. What type of fees and burden might I have if I have a Florida and North Carolina LLC under a Wyoming LLC?

The scenario I am trying to avoid starts at 23 minutes in the video.

 

[quincy]

Thanks for the info. What type of fees and burden might I have if I have a Florida and North Carolina LLC under a Wyoming LLC?

The scenario I am trying to avoid starts at 23 minutes in the video.

The YouTube link was edited once from your earlier post. Please do not add it back again. Thanks.

 

[wonderd4]

So I am not even allowed to give the name of the youtube title to try to get my questions answered? If so my posts get deleted? What type of forum is this?

 

[Zigner]

So I am not even allowed to give the name of the youtube title to try to get my questions answered? If so my posts get deleted? What type of forum is this?

It's not one for posting links such as you posted. If you need more specialized advice, speak to an attorney. Just to be clear. You NEED more specialized advice, so speak to an attorney.

 

[quincy]

So I am not even allowed to give the name of the youtube title to try to get my questions answered? If so my posts get deleted? What type of forum is this?

This forum is not designed to advertise or promote YouTube videos.

In an earlier post you said you were "listening too much to this guy on YouTube" and you were questioning what you heard. Perhaps you might want to stop listening to the YouTube video and seek personal assistance from an attorney in your area?

Taxing Matters provided you with good information and advice. He did not need to view the video to provide it.

Good luck.

 

[wonderd4]

He said he only watched part of the video. My question was regarding a part he did not watch. In which case in order for him to answer the question he would have had to seen the part of the video I was talking about.

 

[Zigner]

He said he only watched part of the video. My question was regarding a part he did not watch. In which case in order for him to answer the question he would have had to seen the part of the video I was talking about.

Please consult legal counsel. Best of luck to you.

 

[quincy]

He said he only watched part of the video. My question was regarding a part he did not watch. In which case in order for him to answer the question he would have had to seen the part of the video I was talking about.

Stop watching the video and you will eliminate the source of your questions.

I recommend, as did Taxing Matters and Zigner, that you see an attorney in your area for assistance.

Good luck.

 

[wonderd4]

Stop watching the video and you will eliminate the source of your questions.

I recommend, as did Taxing Matters and Zigner, that you see an attorney in your area for assistance.

Good luck.

Right because people can not get education from a youtube video.

 

[Zigner]

Right because people can not get education from a youtube video.

Apparently not, as demonstrated in this thread.