I am planning to buy a small vacation home/rental - Business Name or Personal Name?

I have an online side business which is set up as an LLC (I am the sole owner/sole employee). If I purchase the vacation home I may use it for rental income. Should I buy it under my business name or my personal name?


I would think the business name 1. to save taxes (small biz taxes are a killer) 2. Liability reasons.


Are there any drawbacks in setting it up in the business name?I am planning to buy a small vacation home/rental - Business Name or Personal Name?
if you are the sole owner of the llc, your profit/loss from the llc passes through to you, and therefore there is no tax savings involved. You might be able to help with the liability side of having it be owned by the llc, but not with the tax side. And you might want to check and see what state laws you need to follow for an llc. Massachusetts requires all llc's to pay an annual $500 fee.I am planning to buy a small vacation home/rental - Business Name or Personal Name?
I am not a fan of LLCs for tax purposes in the first place. Therefore I would always discourage folks from putting assets into them unless they are directly related to the activity of the LLC. The primary purpose of an LLC is to protect you assets from liability based on the activities of the LLC. If you have a major asset in the LLC it would not appear to be protected. Now, if you were planning on renting to illegal drug deals or manufactures you surely would wish to have it in the LLC. Also I can not think of a single tax advantage from having the rental in your LLC.
This is a good article on that subject:





http://biztaxlaw.about.com/od/dealingwit鈥?/a>








I'm not an expert on the subject, but even though you're talking LLC and the article is talking mostly about S-corps and C-Corps, it seems like some of the things would still apply to an LLC. For instance the personal holding company rule...who knows, but it's still good to know.
rental income as in individual just goes straight on a schedule E on your 1040 - there are no ';business'; taxes, just normal income tax - no FICA. Homeowners insurance on the house covers liability