What's the reason some investors have holdings companies?
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[{"id": "frgd61y", "text": "Liability protection against their personal assets.", "replies": [], "depth": 1}, {"id": "frgkd4r", "text": "Tax and liability reasons.", "replies": [], "depth": 1}, {"id": "frhi2v2", "text": "Many reasons. Other than the ones already noted such as liability, typically there is a formal lease agreement between the operating company and the holding company. This allows the owners to manage the operating company\u2019s bottom line with rental expense taking up a big chunk of operating income, resulting in tax savings. On the other hand, the owners now have income through the holding entity where they can then take huge distributions without any of the rank and file employees in the operating company\u2019s accounting department to feel they aren\u2019t getting there fair share.\n\nCould also be to separate investment strategies among different real estate portfolios if an operating company doesn\u2019t exist (spec, rehab, hold, etc)", "replies": [], "depth": 1}, {"id": "fris3gj", "text": "The assets aren\u2019t held by the Corp, that is likely the management company. You don\u2019t put depreciating assets into corps.", "replies": [], "depth": 1}]