Ownership Business Stuctural; LLC vs C-corp vs S-corp
I am buyng my first commercial property. The property consists of three buildings.

1. 1500 sqft shed; needs work, to be used by my company

2. 3500 sqft shop; needs minor work, to be used by my company

3. 4500 sqft +100 yo building which needs a lot of work. I will either expand into this or rent it once the work is done.

I was told by the lender not to put the building ownership under my current companie's c-corp. So I need to start a new company. Everyone says to talk to your lawyer or accountant. My accountant does not seem to be much help. I don't have a lawyer.

My requirements for the new company:

* There will be workers in these buildings so I do want to have it under some liability protetion. 
* I plan for my current company to pay rent to the new company. The proceeds of the rent will be invested back into the building. I want to be alble to write off as much as possible.
* Shared ownership.
* Potential to buy other buildings.

The last two items would be if I find a good partner to help me rehab the building.

From what I have read so far, LLC seems to be the way to go. Is there anyone who has done this before have some comparisons of LLC vs C-corp vs S-corp?
[{"id": "it83b7n", "text": "Talk to an accountant or lawyer. Maybe ask around and find someone else you trust. I don't think Reddit will be able to give you proper advice. Should definitely have a separate entity.", "replies": [], "depth": 1}, {"id": "it83vhy", "text": "Yes, talk to a lawyer to set up an LLC.\n\nThat your accountant wouldn't tell you, at minimum, not to put it in an S Corp nor a C Corp is odd.\n\nC Corp has double taxation on all of its income and the rates on long term capital gains are the same as the rates on any other income. Assuming you expect to have substantial appreciation if you ever sell the real estate, it makes sense not to hold it in a C Corp.\n\nAn S Corp is for lowering self employment taxes, but rental income isn't subject to those anyways, so there's no need for that.\n\nDid your accountant hint at the self-rental rules? Maybe they don't apply because of the C Corp... Maybe you need to find a new accountant.", "replies": [{"id": "it87och", "text": "100% agree on new accountant. I just don't make enough to spark their interest.", "replies": [], "depth": 2}, {"id": "it8rri9", "text": "This is the correct advice. LLC is the way to go. Find a real estate lawyer, who can help you draft an LLC Agreement, which will dictate how the different owners will interact with one another and how management of the LLC (and, ultimately, the property) will occur. This should also have some info about how affiliate agreements (your lease with the c-corp) are approved by the other owners.\n\nIf you're going to buy more properties, set up new LLCs for those properties. The \\~$100 Secretary of State fee is well worth it to separate liabilities for each property. \n\nFinally, talk to your insurance broker and make sure you have good liability insurance. The LLC's limited liability protections are meant to ensure you, personally, don't pay out of pocket for some entity-related liability. It doesn't protect the entity from owing a liability. This is where your insurance will be important. \n\nAs an example, if your janitor forgets to put up a \"wet floor\" sign and someone slips and breaks their back, the LLC will ensure you personally are not on the hook for the damages. The entity/property will still be on the hook, to the extent there are assets to pay the damages, and insurance will help absorb this liability and ensure your investment in the property is protected. Your broker and lawyer can help you navigate these waters in different ways.", "replies": [], "depth": 2}], "depth": 1}, {"id": "it873id", "text": "Speak to a real estate attorney. Definitely you'd want an LLC holding company for the property. \n\nIn addition, if your accountant can't give you the help here you may have also outgrown them. This is pretty basic knowledge and if they don't know this then they're probably not maximizing tax benefits for you and your company.", "replies": [], "depth": 1}, {"id": "it873vc", "text": "TAX ATTORNEY", "replies": [], "depth": 1}, {"id": "it8w4wa", "text": "Get a new accountant. Find a RE lawyer.", "replies": [], "depth": 1}, {"id": "ita39wi", "text": "LLC. But if you buy other buildings, you\u2019d really want to create two LLCs. An umbrella LLC (basically a shell company) that would own all of the LLCs for each specific building.\n\nDo not put into your C-corp.\n\nI have a C-corp and an LLC in pretty much the same situation as you, but I have extensive history with real estate and tax complications. I do recommend hiring an attorney who deals with real estate to advise on your specific situation.", "replies": [], "depth": 1}, {"id": "ita7zlj", "text": "Most properties are owned in LLCs.  An S Corp if you want to pay yourself as an W-2 employee.  C Corp if you want a board of directors and many employees.  \n\nIt is possible (maybe even ideal) to start as an LLc, grow into a S corp (once a steady paycheck can be issued) and then a C corp.", "replies": [], "depth": 1}, {"id": "itm0j9u", "text": "I set up a holding company to buy an industrial condo this month.  \nThe benefit of the holding company is legal liability protections.  If your company is sued, the LLC holding the properties is separate.  If you want to sell the business, the properties are separate (which may be attractive to the purchaser to move your business into their properties / etc / whatever... ).  \n\nYou don't really want the LLC / holding company to be taxed as an S-Corp (unless it is a huge entity with tons of buildings and employees);  the rental income is passive income and doesn't infer self-employment taxes (which is the selling point of the S-Corp).\n\nIf you setup the S-Corp you to have setup formal payroll / quarterly filings / lots of overhead -- no financial gain.\n\nThere's no gain here for the S-Corp.   (I have no idea on the C-Corp, but I don't see any benefits unless you are running the holding company a for-profit business to acquire future properties or some reason you would keep the cash in the entity.  You noted you want to buy future buildings -- create a new LLC when you do that... each building is it's own LLC, so you have maximum legal seperation.  A tenant sues you at one building in a slip and fall (catastrophich spinal cord injury), if your LLC has 10 buildings they can go after all ten.  If your LLC has only one building... they will still try to go after the other 9, but it will be much harder to do so).\n\nSo setup your LLC, file a 1065 for it...   No S-Corp needed.", "replies": [], "depth": 1}]