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 couldown 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 termand as I am pretty young (22 years old. Could anyone please point out any flaws in this strategy and thingsI should be mindful of. I am interested in constructuve advice on how this could work rather thangetting some advice to forget about it and owning theproperty 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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