I'm a new customer and having some trouble getting started, and I'm hoping to receive some guidance from Jonathan and other members. It seems the ebook comes from a standpoint of having an owner with multiple properties, but my structure is a bit different.
Here is my situation: I have three rental properties. One is a single family home, one is a condo unit in a large complex, and the other is a duplex where I live in one side (owner occupied). I have a c-corp that acts as a rental management company where all tenants pay rent to and the corp pays all expenses including the mortgage payments. The corp also charges a 10% management fee which it is mostly to show that it is a real business.
I have an LLC (disregarded entity for tax purposes) that holds land trusts for all the properties and acts as the property management company. The corp is a manager of the LLC. The LLC company does nothing besides provide pass-through cash flow to the members (myself and my wife).
Here are my questions:
- Should there be two company files? One for the corp and one for the LLC?
- Which company file should I track interest/escrow for the mortgage payments?
- Besides management fees, how should I handle expenses the corp incurs that are billed to the LLC for reimbursement? Should I take this out of gross rents or create invoices?
My ultimate goal is to be able to create reports that show how the properties are profitable, or not, so that I can determine to continue in real estate investing/landlording or invest my money in more productive ways.
Thank you in advance for your detailed responses.