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FORTUNE Small Business:

Investing options for an LLC

In most places, a company can invest in anything an individual can.

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(FORTUNE Small Business) -- Dear FSB: We're a new LLC, a consultanting firm. Can a company invest in real estate?

- Robert Jackson Summerville, SC

Dear Robert: Yes.

"Generally, LLCs are not limited in the kinds of investments they are permitted to make," says David S. Sokolow, a senior lecturer at the University of Texas at Austin School of Law whose areas of expertise include corporations and contracts.

"In most states, corporations & LLCs have the same powers as an individual; thus, investing in real estate is fine," he says. Be sure to check the law of the state in which the firm is formed, since that particular state's laws will govern what the firm can and cannot do.

If you formed your LLC from where you're writing, in South Carolina, you're clear to invest in real estate, according to David Jones, an attorney with Tiencken Law Firm in Charleston, who said he "wasn't aware of any statutes preventing LLCs from doing so."

Fort Mill corporate attorney Bayles Mack, of Mack & Mack agrees: "Unless there's something in the corporation's own operating laws which would override the state's statutes, that prevents them from doing so, they're free to invest."  To top of page

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