What is the best type of wholesale real estate company structured for rehabing and reselling property and contracts?

I am considering getting my brokers license and loan originators license to attach to the company also. I am looking for a way to structure the company so I am protected financially from any lawsuit that could arise and I would like to be structured to save the most on taxes as possible. I am opening and doing the business, however I am open to having the business LLC with s filing status or S-corporation originated in a different state for tax savings and personal liability protection or privacy. I prefer privacy.

Asked on November 15, 2014 under Business Law, Pennsylvania


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

1) It does not matter which state you form your business in, for purposes of either liability protection or tax liability.

2) Either an S-corp of LLC gives you the same level of liability protection (the most you can get from business structure) and the same tax treatment (pass through, if you elect for the LLC to be taxed as partnership). For small businesses, an LLC is less formal, more flexible, and requires less paperwork/filing.

3) Having adequate insurance is an important part of liability protection.

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