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Author: Blueyale One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 120807  
Subject: LLC and Real Estate Strategy Date: 9/20/1999 1:34 AM
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I am thinking of investing in some residential and
commericial rental property and would like to
structure my affairs to optimize tax savings and
limit liability.

I've been told by a tax specialist that one could
own the rental property through a LLC with two C corporations as the members. Since the LLC is a pass through entity for Tax purposes, the corporations would receive the rental income as "active income" rather than "passive income". The reason for doing this is to avoid the onerous Personal holding company designation that would result from owning the property in a C corporate entity.


My intention is to acquire assets over the long term
and as I am pretty young (22 years old. Could anyone
please point out any flaws in this strategy and things
I should be mindful of. I am interested in constructuve advice on how this could work rather than
getting some advice to forget about it and owning the
property in my name. I have crunched through the numbers and the tax savings will be significant over time as my goal is to acquire assets.
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