@Carl wrote:
Must depend on the state....
It depends on the state. For example, some states have ridiculously high fees for filing an annual report and most also levy a tax on income from rental real estate.
So now, with just a multi-member LLC, you have to prepare and file a federal income tax return and issue K-1s to the members and, most likely prepare and file a state income tax return and issue state K-1s to the members. Then, again depending on the state, the members might have to file individual income tax returns in the state where the property is located. F
Further still, the members now have to track their outside and inside basis.
All of the foregoing simply a result of organizing a multi-member LLC. That is not necessarily a bad idea if there will be multiple rental units but, as a general principle, it is not exactly great for one long-term, single-family rental house.
