Guides No. 04
Entity structure for rentals: LLC, S-corp, and beyond
LLCs, partnerships, S-corps, and corporations carry different filing, liability, and self-employment consequences. The right structure depends on your holdings, your income, and your plans, and it can be chosen deliberately rather than guessed.
Who it fits
Rental owners weighing holding structures, S-corp owners with business income, and investors with multi-entity setups. The questions get more interesting with every door, every state, and every partner added.
If the file is growing and you are weighing a new preparer, see Choosing a tax preparer when your rental portfolio is growing.
The common options, in general terms
An LLC is the common holding vehicle for rentals. Multi-member LLCs usually file as partnerships. An S-corp election can change how a business owner's income is characterized between salary and distributions, which is why it comes up for active businesses. Corporations appear in fund and syndication structures. Each choice moves filing obligations, liability posture, and self-employment treatment differently.
What changes when you change structure
New filings, different return forms, banking and title questions, and sometimes payroll. None of it is free, and not all of it is worth it. The point of the planning session is to weigh the tradeoffs against your actual facts instead of copying another investor's structure.
How Bellamy approaches it
Entity questions are a core part of the planning session, $1,500, about 60 minutes recorded, with written action items. When the answer is a real restructuring, entity restructuring runs as a specific project, scoped on a call and quoted at a firm number before work starts. Prep covers 1120-S and K-1s from $650. The firm also works with syndicators and funds.
What does not work
Copying another investor's structure. Moving titles without considering financing and insurance. Forming entities for the sake of forming entities. Structure follows facts, and the facts change as the portfolio grows.
Informational only, not tax advice.
FAQ
Structure questions.
Should every rental be in its own LLC?
Not automatically. Isolation, financing, insurance, and state filing costs all factor in, and the right answer changes as the portfolio grows. It is a planning question with real tradeoffs, not a rule with a fixed answer.
Does an S-corp save taxes on rental income?
Rental income is generally not self-employment income the way active business income can be, which is exactly why S-corp elections matter more for active businesses than for passive holdings. Whether an S-corp fits you depends on what else you operate. The facts decide, and a planning session maps them.
We are forming a syndication. Can you help?
Yes. The firm works with syndicators and funds, alongside individual investors. Bring the structure questions to a discovery call and the firm will tell you plainly whether it is a fit.
When is the right time to think about structure?
Before acquisitions and before year end, while moves are still possible. Structure decisions are cheapest to make deliberately and most expensive to unwind. The fourth quarter is the working window for the current tax year.
Your next step
Let’s talk about
your rentals.
Meet Corben. Explain what you own and what you need. Leave knowing the next step.
Your intro call comes before any planning session.