Creating a Rental Property LLC in Wyoming

Benefits of creating LLCs for rental properties in Wyoming 

Liability protection

One reason real estate investors choose to create a rental property LLC in Wyoming is to limit their personal liability. If you form your rental property LLC in Wyoming and don’t personally guarantee the company’s debts, you can’t be held personally liable for them. This is one key way that rental property owners protect their personal assets when choosing to set up limited liability companies.

Pass-through taxation

A rental property LLC in Wyoming also offers real estate investors pass-through taxation. Pass-through taxation means that property owners are taxed at their personal income tax rate instead of a corporate income tax rate. There may also be certain LLC tax incentives in your city or county. Make sure to check with your local government and tax commission.

Separate personal and business assets

Another way that an LLC can protect real estate investors is by separating business property from personal property. Separating liability for business assets from personal assets and debts can be key to your personal and professional success. 

Series LLCs for real estate investors in Wyoming 

A series LLC is a good idea for those who plan to own several rental properties. Wyoming is one of only 18 states that allow the creation of series LLCs. A series LLC is similar to a holding company. It allows a real estate investor to form one LLC and have an unlimited number of members with separate books and records “under the umbrella” of the main entity.

Forming a series LLC is similar to forming a regular LLC. However, the form and format ask an applicant to specify the details of the “series” of members. The Wyoming Secretary of State’s Office can address any questions you may have about series LLCs.

How to form an LLC for your Wyoming rental property

Forming an LLC typically involves:

Step 1: Choose LLC Name

When selecting a name for your LLC, be sure to choose one that meets state requirements. We can do a search for you to see if the business name you want is available. If it is, let us reserve the name while you get the filing paperwork together. 

Step 2: Select Registered Agent

Businesses in the state are required to appoint a registered agent. This person is responsible for receiving important documents on behalf of the LLC, such as state correspondence and legal notices. If you need a registered agent, we can help you find one.  

Step 3: File Certificate of Organization

To officially form your rental property LLC, you need to file a Certificate of Organization with the right state office and include the appropriate filing fee.

Step 4: Create an Operating Agreement

Your LLC’s Operating Agreement is one of your most important business documents. It governs how your LLC runs and provides instructions for anything from voting procedures to dissolving the company altogether. If you’re not sure how to create an Operating Agreement, we offer templates that can serve as a guide. 

Step 5: Apply for Employment Identification Number (EIN)

The IRS assigns businesses a nine-digit EIN that is used to identify their enterprise. Having one is necessary for certain business matters, such as opening a business bank account, hiring employees, and getting financing. You can apply for an EIN yourself on the IRS’s website, or we can do it for you with our EIN service. 

Step 6: Transfer the Title of the Property to Your LLC

If you form your LLC before purchasing your property, you can skip this step. However, if your name is on the title to your rental home, you’ll need to transfer the title of the property to your LLC once it’s formed. To accomplish the transfer, file the revised deed with the proper city or county authority. You may also need to pay a title transfer tax, if applicable. Your local tax authority or county assessor’s office can provide you with more information.

If there’s an existing mortgage or loan on the property, you’ll need to inform the lender of the change. The bank may want to revise the loan agreement. Because the point of having the LLC is to separate your personal assets and business assets, the bank may have additional questions. This is another reason why forming your LLC before buying property makes your life easier.

If you formed your LLC before you bought and leased out your property, then you’re good to go. You’ll just need to set up your lease agreements to ensure that your renters pay rent to the LLC and not to you personally. However, if you formed your LLC after you purchased and leased your property, be sure to inform all current tenants or renters of the ownership change. You’ll then need to edit your lease agreement to reflect the change.

Who should form a Wyoming LLC for their rental property?

Any investment property owner looking to establish or continue renting their properties for vacation or residential purposes should consider forming an LLC. Most investors consider it easier to form their LLC before purchasing rental properties. If you create the LLC first, then you can buy the property under the LLC’s ownership. If you do this, then the rental property is held in the LLC’s name. Having your investment property held in the LLC’s name from the start can streamline your workload and property management operations. We’ll explain how forming the LLC first makes your life easier below.

How We Can Help

We can help you quickly and easily form your rental property LLC in Wyoming so you can get to work faster. Our suite of business services helps connect real estate investors like you with the practical information you need to run your business smoothly.