Wholesaling-The Business Structure

by | Feb 2, 2023

When it comes to wholesaling, you definitely want to set up an LLC. This keeps that activity separate from you for liability purposes.

There are lots of other entity types. There are S-Corps, C-Corps,  and general partnerships.

What I recommend at the end of the day, after all the studying we’ve done and all the experience we have, is that an LLC is simply the easiest, least expensive, fastest way to set up a separate entity to shield you from liability.

The reason behind this is, life isn’t perfect. Things sometimes don’t go the way you think they’re going to go. Let’s say you get involved with a wholesale transaction and down the road, the consumer files a complaint. If you executed the sale in your own name through what’s called a sole proprietorship, you would be held liable and your assets would be potentially at risk in a lawsuit. However, if you set up a limited liability corporation, LLC, you get some of the same benefits of being a sole proprietorship but you also get some of the benefits of being a corporation. One of those benefits happens to be a separation of liability, or liability protection.

If you were involved in a wholesale transaction through your LLC and the consumer involved in that same transaction decided to file suit down the road, they would file suit against the LLC rather than you personally.

Learn more as Gary explains in the video below:


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