In this video, we take a deep dive into one of the most common questions real estate investors ask: “How do I pay myself out of my LLC the right way?”
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Whether you’re running a rental property or managing short-term rentals through your limited liability company, the structure of your business and the nature of your income significantly impact how you should be pulling out profits.
The way your LLC earns money—whether through passive rental income or active business activity—plays a critical role in determining the correct and most tax-efficient withdrawal method.
From there, we explore different LLC structures and the flow-through nature of these entities, particularly in the context of passive income.
You’ll learn why rental income is taxed to you personally whether or not you actually withdraw the money, and how to work within that framework to avoid costly mistakes.
Watch until the end to avoid the tax traps and stay compliant while keeping more of your hard-earned money.
Show Notes
0:00 Introduction: How to Pay Yourself from an LLC
0:17 Why “It Depends” on Your Business Structure
1:51 Tax Implications of Passive Income
3:41 Why You Shouldn’t Pay Yourself a Management Fee
4:27 How to Actually Take a Distribution
7:13 Paying Yourself from an S Corporation
9:31 Using Payroll and Distributions Together
9:50 Paying Yourself from a C Corporation
10:43 The C Corporation Dividend and Double Taxation
11:55 Taking Reimbursements from Your Business
12:39 Common Reimbursement Scenarios for Real Estate Investors
14:37 Strategic Entity Planning Beyond Tax Benefits
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ABOUT CLINT COONS
Clint Coons, Esq. has grown his legal and tax firm to over 400 employees by assisting real estate investors with creating and implementing solid entity structuring plans. His success in these regards is in large part due to his personal investing experience. A successful attorney, real estate investor, and speaker, Clint has used his innovative and dynamic strategies coupled with knowledge borne from experience to help thousands of people save millions of dollars and build real wealth.
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The information provided in this video should not be construed or relied on as legal advice for any specific fact or circumstance. Its content was prepared by Anderson Business Advisors with its main office at 3225 McLeod Drive Suite 100 Las Vegas, Nevada 89121. This video is designed for entertainment and information purposes only. Viewing this video does not create an attorney-client relationship with Anderson Business Advisors or any of its lawyers. You should not act or rely on any of the information contained herein without seeking professional legal advice.
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