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Vermontess t1_j8rks3n wrote

Reply to comment by Interesting-Field-45 in How Vermont’s Housing Crisis Got So Bad by punkthesystem

An LLC does not obsolve landlords of liability- they are still on the hook for damages and can be forced to sell the rental to pay damages to a renter. Most mom and pop landlords in VT use LLC’s so they don’t lose everything if someone slips and falls on some ice at their rental house and insurance doesn’t cover the damages. They would just lose their entire business, but in theory it protects the house they live in and other separate assets. The same way it is with a restaurant owner or grocery store owner or any other LLC business.

How can someone use an LLC as a means to avoid paying taxes? I understand there are bad actors at all levels, but what about an LLC specifically makes someone more likely to commit tax evasion?

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Interesting-Field-45 t1_j8rorb3 wrote

They should lose their “business” and be liable. We would have a lot less landlords and a lot more housed people. Houses would not be insanely out of reach if actual human beings could own them. Mom and Pop landlords? Lol. Most ridiculous thing I have ever heard. LLCs don’t have to be attached to them personally, you can have a Montana LLC that has no name attached. A trust can own an LLC. There’s a reason people LLC in Delaware so often. Billionaires use LLCs to avoid taxes and launder money literally everyday. The tax codes are so intricate and so confusing, you have to be an expert to truly understand how they move their money around to legally evade taxes. People from countries like China exit their money via properties and goods.

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Vermontess t1_j8rr13b wrote

They do lose their business. They are liable to lose their entire LLC and everything owned by it.

Over 70% of rentals in Vermont are owned by small or medium landlords and are usually held in LLC’s. The tax benefits of being a landlord are not anywhere near as advantageous as I had assumed before I read more about it for a family member

Personally, I think you're conflating LLC behavior with that more typical of corporate REI’s but I’m entirely sympathetic your EAT THE RICH vibes

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