You’re Buying a Home — Should You Use an Entity?

When you buy a home, you can take title in your own name, or you can form a legal entity (like a corporation or LLC) to hold the property. Each option has pros and cons. Here’s a plain-language breakdown to help you decide:

Individual Ownership (Your Name Alone)

Pros:

• Simple and inexpensive — no need to form or maintain a company.
• Easy to get a mortgage, insurance, and homestead exemptions.
• No annual filings or separate tax returns.

Cons:

• No liability protection — if someone sues over the property, your personal assets could be at risk.
• No privacy — your name appears in public records.
• Property goes through probate when you pass away.

Corporation (Inc.)

Pros:

• Strong liability protection — your personal assets are shielded.
• Can be useful for business or rental properties.

Cons:

• More expensive to set up and maintain.
• Requires annual reports, corporate minutes, and separate tax filings.
• May face double taxation (corporation pays taxes, then you pay again on income).
• Less flexible for real estate — not ideal for personal homes.

Limited Liability Company (LLC)

Pros:

• Strong liability protection — protects your personal assets.
• Flexible tax treatment — can be taxed like a sole proprietor, partnership, or S-corp.
• Easier to manage than a corporation — fewer formalities.
• Can provide privacy — in some states, ownership isn’t publicly listed.

Cons:

• Costs the most up front — you’ll need to form the LLC and pay filing fees, and pay for a public notice to be advertised.
• Requires some maintenance, but less than a corporation — annual filings and a basic operating agreement.
• May affect mortgage options — some lenders won’t lend to LLCs for residential purchases.

The Bottom Line

• If this is your primary residence, and you’re not renting it out or running a business from it, individual ownership may be simplest.
• If you want liability protection, privacy, or plan to use the property for investment or rental, an LLC is often the best choice.
• A corporation is rarely used for home ownership unless part of a larger business strategy.

Let’s talk through your goals and comfort level, and we’ll help you choose the best fit. If you decide to use an LLC, we can help set it up and make sure the property is titled correctly.

Welcome to homeownership — we’re here to make it smooth and secure.

Roger A. Levy is a founding member of Levy & Nau P.C., where he practices law in the fields of real property, estates, wills, trusts and related litigation. When not flying a desk, Roger flies a twin-engine Cessna 337 Skymaster. He also holds the rank of Major in Civil Air Patrol, the official Auxiliary of the US Air Force, and commands CAP’s New York City Group.