Second LLC taxed as S-Corp (rental income) worth it?

Tax Strategies
1

Hello Mark & Mat,

Long time listener and client of KKOS,
Married with 3 dependents owned a Parent LLC (taxed as S-Corp) that owns 2 LLCs (operational), Solo K, and more to come.

Here’s what we are dealing with now,

  1. Acquiring a commercial property for one of our LLC as expansion, will be leasing part of the building out for others. Might have on-site manager that we will be hiring or contract it to a third party (maybe my parents). We do not want to lose the Solo K so, this LLC can’t be a disregarded entity/ pass-thru entity to my or worst own by my S-Corp LLC, right?
  2. Will it be a problem with my primary Solo K, if this LLC (investment) elected to be taxed as S-Corp at the end of the year 2023. Let’s say it has 3-4 contractors (1099s) and paying a management company (my parents) to handle the on-site day to day, janitorial & etc. Do I have to W2 myself for this LLC(S-Corp) or all K-1?

I am on the waiting list for the CPA tax strategy already.

Thank you much guys!

2

Thank you for the question. We answered it on today’s show on 2.19.23. Thanks for listening. MJK & MNS

3

Thank you Mark & Mat. You guys rock!

I should have clarified that the LLC owning the property will be on the right side since it’s a passive, I will be trying to stay on 1099 as long as the law allows for the on-manager. All the income & expenses from this LLC should be reported in Sch C passing thru to our 1040 for 2023, correct?

You mentioned parents can play along with our Solo K? Children over 18?

I am still waiting for the CPA waiting list lol.. I missed the early bird CTA sign up..