USA LLC and K1s for real estate invesment

[Shafi]

Hello, I'd like to pool money with friends to invest privately in real estate. I will be the GP and my friends will be LPs. I'm not sure about a few things such as whether the LLC should be a subsidiary to my current company and how to distribute K-1s and other best practices. Anyone have insight on this?

-Shafi

 

[wawyllc]

Hello everyone,
I have a similar issue.
Could someone help Shafi and I?
Thank you very much.
Benjamin

 

[MoralesTax]

Ordinarily, when you open an LLC as a real estate investment vehicle, you want it to be a stand-alone entity. By this, I mean that you want to stay away from making it a subsidiary of another company, as that could potentially implicate an unrelated parent company to the liability of holding real property.

That said, how you structure it is up to you. Real Estate Investment LLC's ordinarily are taxed as a partnerships, owned individually or by holding companies (or trusts) on behalf of individuals, and K-1s are issued accordingly.

I cannot comment beyond this without more specific scenario/information provided.