- quote -

SNIP

- quote -

I sure hope your CPA wasn't preparing legal documents, as he
may have been practicing law without a law license (unless
he was licensed as an attorney also, or if state law in your
state allows non-lawyers to prepare such documents). In
some states this is a crime. While filling out a state
agency-generated form may not be practicing law without a
license, if he/she did "regulations" or an "operating
agreement" for the LLC then he/she very well may have. You
should consider having a licensed attorney review this work
to be sure everything is okay and that the accountant didn't
overstep any lines peculiar to your state's law governing
the practice of law by a non-licensed person.

Jason Richardson
Attorney, CPA
Sherman, Texas

I am not your lawyer, nor am I your accountant, etc....

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"FE" <never_say_spam[at]nospam.com> wrote:

- quote -

Not that I'm aware. I don't know what the rules are in
Arizona, but in California an LLC or corporation can
generally be legally created within 24 hours. You may be
able to get your LLC created before the sale is completed.

- quote -

In this case there will be very strong evidence (official
state documents) that will clearly show the LLC was not in
existence on the date transactions were purportedly done.
While I think it's acceptable to backdate documents to the
extent they merely document what actually happened, I'd be
very wary of doing that in this case - people have gone to
jail for backdating some documents.

Stu

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In late January 2003, I bought a single family home, fixed
it up, then put it back on the market. It closes next week,
the last week of October 2003 (knock on wood). The profit
was by no means great, but I learned enough to want to keep
doing it. In short, I'm going to continue this property
"flipping," plus invest in some rentals.

I met with a CPA a couple of times last week to set up an
LLC for my real estate investing, which he will also somehow
combine with a Sub-S. I'm told that it's a good idea for
tax purposes and for liability protection.

My first meeting with the CPA was on Monday, and we
discussed what he was going to do. Within a day or two he
had an "EIN" tax ID number for me and also verified that my
company name was available in my state, AZ. Later that week
on Friday I signed several documents related to getting the
LLC/Sub-S established. The documents I signed on Friday
were all back-dated to Monday by the CPA. He also told me
to close my old checking account and open a new one for the
LLC, and that the bank would probably let me do that even
before the LLC was officially establshed. The date I was
told that the LLC would be complete isn't until after the
date that my property closes. So in other words, I will have
generated all my expenses and reaped the profits from my
property before the LLC is established.

Maybe this is just all new to me, but I feel a little uneasy
about a couple of things. First, can I establish an
LLC/Sub-S after the fact, then put the property's
expenses/profits under it? Maybe this is standard practice
and not a big deal. Also, is back-dating paper work like I
described above a commonly accepted accounting procedure?

Thank you for your time.

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