To comply with state laws, Rocket Dollar recommends registration with the state where the real estate property is located if you are renting the property.
What state LLC do Rocket Dollar accounts default to?
Rocket Dollar uses a Colorado LLC. They are affordable, business-friendly, and easy to work with, enabling us to deliver better value to our customers.
What should I do if I own property in a state other than Colorado?
Generally, your LLC should be registered as a foreign entity if you start renting out that property to tenants. Also, if you are investing in fix and flips and doing more than once per year, you should register your LLC in the state or states where the properties are located. Some customers prefer to open a local LLC as a "JR LLC" with the Colorado LLC being the "Sr LLC," owning everything below it.
Why? When you are renting a property, you are considered to be "doing business" in the state and you have to comply with state business codes. Taking full advantage of business law, landlord protections, and tenant law is wise.
What if I live in California?
What about the Solo 401(k)?
The Rocket Dollar Solo 401(k) is a retirement trust. Trusts typically do not have to be registered in states like LLCs.
Please consult with an attorney or CPA.