Setting Up a Real Estate Holding Company for Your Florida Business

2 business partners setting up a real estate holding company in Florida
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Setting up a real estate holding company in Florida is a smart way to protect assets, limit liability, and manage properties efficiently.

Here is a step-by-step guide:

1. Choose a Business Structure

  • The most common choice for a real estate holding company is a Limited Liability Company (LLC) because:
  • It protects personal assets from lawsuits and debts.
  • It provides tax flexibility (pass-through taxation).
  • It requires minimal formalities compared to corporations.

2. Choose a Business Name

  • Your LLC name must be unique and include “LLC” or “Limited Liability Company”.
  • Check availability on the Florida Division of Corporations website (www.sunbiz.org).

3. Register the LLC with Florida

  • File Articles of Organization with the Florida Division of Corporations.
  • The filing fee is $125 (as of recent updates).
  • You can file online via Sunbiz.

4. Appoint a Registered Agent

  • The registered agent must have a physical address in Florida.
  • They will receive legal and tax documents on behalf of your company.
  • You can act as your own agent or hire a service.

5. Obtain an EIN (Employer Identification Number)

  • Apply for an EIN from the IRS (free) at irs.gov.
  • Required for opening a business bank account and filing taxes.

6. Draft an Operating Agreement (Recommended but not required)

  • Outlines ownership, management, and decision-making rules.
  • Helps prevent disputes between partners.

7. Open a Business Bank Account

  • Keep business and personal finances separate.
  • Use the LLC’s EIN to open the account.

8. Transfer Property into the LLC

  • File a Quit Claim Deed or Warranty Deed to transfer property ownership to the LLC.
  • Record the deed with the local county recorder’s office.
  • Be aware of potential due-on-sale clauses in mortgage agreements.

9. Ensure Proper Licensing & Compliance

  • Depending on your activities, you may need a business license from your local city or county.
  • If renting property, comply with landlord-tenant laws and local rental regulations.

10. Maintain Annual Filings & Taxes

  • File an Annual Report with Sunbiz.
  • Pay Florida state taxes if applicable.
  • Keep proper accounting records and file necessary IRS forms.
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