Starting a Realestate investment LLC what should the bylaws be ?

Question

Starting a LLC with a few family members to invest in some realestate what should the bylaws for the Corporation Be ?

Answer 1

An LLC, under state laws, are not corporations so no bylaws, minutes or meetings are required.  What an LLC should have is an Operating Agreement.  This will layout the purpose of the business, the owners, how profits/losses will be allocated, what federal tax designation the LLC will have, etc.

You should seek the advice of a qualified business attorney and/or tax professional to assist you with the creation of the Operating Agreement.  This is not to be taken lightly; it governs the way your LLC operates and if not followed and the LLC is sued; your liability is now unlimited.  It does you no good to operate an LLC in a way not laid out in the Operating Agreement.

Also, you need to understand that an LLC is not a corporation or a partnership; it is a state created entity that does not exist with the IRS.  You must make an election to be taxed with form 8332 for partnerships and C Corporations or with form 2553 to be taxed as an S corporation.  Again, this adds complexity to your situation that would warrant a professional's advice.

Good Luck.

Answer 2

In my opinion, this is not the time to invest in real estate. It's the buyer's market sure, which only means you must have the capacity to sit on a property (sometimes for several months) without revenue.

You might have a better chance with corporate real estate (leasing, apartments, condos, etc) though. It all depends on your location and what the economic climate is over there.