Some do. Miss out on the $500k tax credit but can move buy and sell more freely. Especially if you own multi million dollar homes.
Can you do 1031 to get around the 500k? Or if you really want to claim the 500k, 1031 into a new property, then convert it back to primary? Or before you sell, convert it back to primary?
You can do both on the same property. Half can be a business and the other half your personal property, for example. Like a duplex
How does that work? 50% of the house is owned by LLC renting to yourself and 50% is owned by yourself? So you can only 50% of all the PITI/depreciation etc underLLC and claim the other 50% personally? And when you sell 50% of the gain falls in personal and 50% under LLC?
Pretty close
If the LLC owner is you, then you rent the LLC home and tax file with this arrangement, you are inviting IRS audit one day in future. They will disagree the way you claimed and you need to pay all they years arrears with huge penalty.
I think this is what rich people do.
No rich people will do like this.
Better not to rough with IRS unless you are advised by well experienced CPA and tax lawyer.
Because you are not like this ?