Hello All, I've been spending the past 8 weeks reading countless threads and have reached a major roadblock in starting my Realestate business.
I purchased a property (in NY) that's paid in cash and will be renovated then rented. I will manage the property. I'd like to purchase a second home this year as well and will cash-out refi to help get that one going. I will then manage both properties. I will also offer RE consulting services to older mentors who arent very computer saavy.
Eventually, I'd like to create a LLC to protect my personal assets, but it's not feasible at the moment because I do not have assets to protect [I'm currently a renter with no personal home]. I cannot transfer the home[s] to the LLC as I will be cash-out-refi to get the second. Personal rates are much cheaper and my business will have no 'business credit'history and could present a roadblock.
To get started, i've registered for a 'DBA' 'xxxxx Real Estate'. Some day this may be xxxxx Real Estate, LLC. So here we are!
Question 1 - Bookeeping - Launching a new RE business requires a ton of 'initial capital'. Meaning, I almost immediately need to put up money for inspections, repairs/renovations, fees, registrations, suppplies, etc. Long before I even begin collecting rent. My biggest question is - How on earth do I account for this spending? My books will show lots of spending without any 'income'. I plan on leveraging one credit cards cash advances [0%, 15 months] to help get started. I also have $6000 of my own money i'd like to put in.
Question 2 - Addressing - I'd like to create some anonymity in the form of a virtual mailbox/etc. Ultimately move eveyrthing to that address especially once the LLC is formed. I've been met with nothing but roadblocks. I tried setting up a PO box with USPS, but learned that DBA/Business registration in NYC cant use a PO Box. Even then, the People at the post office gave me a hard time not believing my lease papers, or my Florida ID. I've since requested a NYC ID but that will arrive in two weeks. Delaying things further.
Unfortunately I had to get started on EIN/DBA forms so did it under my primary residence. UPS offers mailboxes but they charge $396/yr which is unreasonable for a business with no income. How do I setup a DBA/Business using an address that's not my own?
Question 3- Credit - I applied for a 'Business' checking/savings via Capital One "Spark". They asked for proof such as:
-SS4 Letter (not applicable, since i'm not corp).
-Tax Return (not applicable since i have not filed)
-Govt Document showing business name and tax ID (I guess the EIN confirmation will work)
-Business Licenses (which arent applicable)
-Utility bill with business name (not possible while working out of my home)
-Proof of insurance (not applicable either)
-Business License (not applicable as Sole Prop).
-I have not received confirmation of DBA application from the state. Maybe that would work?
I expect the same issues to arise when I appy for a 'business' credit card. In general, i'd appreciate any advice going forward. As of now i'm just lost. Thank you
I purchased a property (in NY) that's paid in cash and will be renovated then rented. I will manage the property. I'd like to purchase a second home this year as well and will cash-out refi to help get that one going. I will then manage both properties. I will also offer RE consulting services to older mentors who arent very computer saavy.
Eventually, I'd like to create a LLC to protect my personal assets, but it's not feasible at the moment because I do not have assets to protect [I'm currently a renter with no personal home]. I cannot transfer the home[s] to the LLC as I will be cash-out-refi to get the second. Personal rates are much cheaper and my business will have no 'business credit'history and could present a roadblock.
To get started, i've registered for a 'DBA' 'xxxxx Real Estate'. Some day this may be xxxxx Real Estate, LLC. So here we are!
Question 1 - Bookeeping - Launching a new RE business requires a ton of 'initial capital'. Meaning, I almost immediately need to put up money for inspections, repairs/renovations, fees, registrations, suppplies, etc. Long before I even begin collecting rent. My biggest question is - How on earth do I account for this spending? My books will show lots of spending without any 'income'. I plan on leveraging one credit cards cash advances [0%, 15 months] to help get started. I also have $6000 of my own money i'd like to put in.
Question 2 - Addressing - I'd like to create some anonymity in the form of a virtual mailbox/etc. Ultimately move eveyrthing to that address especially once the LLC is formed. I've been met with nothing but roadblocks. I tried setting up a PO box with USPS, but learned that DBA/Business registration in NYC cant use a PO Box. Even then, the People at the post office gave me a hard time not believing my lease papers, or my Florida ID. I've since requested a NYC ID but that will arrive in two weeks. Delaying things further.
Unfortunately I had to get started on EIN/DBA forms so did it under my primary residence. UPS offers mailboxes but they charge $396/yr which is unreasonable for a business with no income. How do I setup a DBA/Business using an address that's not my own?
Question 3- Credit - I applied for a 'Business' checking/savings via Capital One "Spark". They asked for proof such as:
-SS4 Letter (not applicable, since i'm not corp).
-Tax Return (not applicable since i have not filed)
-Govt Document showing business name and tax ID (I guess the EIN confirmation will work)
-Business Licenses (which arent applicable)
-Utility bill with business name (not possible while working out of my home)
-Proof of insurance (not applicable either)
-Business License (not applicable as Sole Prop).
-I have not received confirmation of DBA application from the state. Maybe that would work?
I expect the same issues to arise when I appy for a 'business' credit card. In general, i'd appreciate any advice going forward. As of now i'm just lost. Thank you
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