Posted by john on October 17, 2007 at 13:49:22:
Wow that’s a lot! Maybe it’s more affordable to buy more insurance that will also cover your personal net worth/assets.
How essential is an LLC? - Posted by George
Posted by George on October 07, 2007 at 09:26:43:
My family owns two commercial properties, both triple net. The properties are held in an irreovocable trust. Insurance coverage is between $1 and $2 million on each property. I listen to the Ray Lucia money show on the radio where he is always advising people to put their properties into LLCs to protect from liability. If my family’s properties are held in an irrevocable trust, both properties are triple net, and supposedly the tenants carry all responsibilities and liabilities according to the leases, how essential is an LLC? I have read that the costs of maintaining LLCs can run several hundred if not thousands of dollars per year to maintain.
Re: How essential is an LLC? - Posted by john
Posted by john on October 16, 2007 at 08:09:10:
I have an LLC for a triple net lease here in Virginia. The cost of the LLC is only $100 year. Call your state office and find out, but they usually are very affordable. Triple net leases are low risk, but why take the chance of a customer coming after your personal assets instead of the tenants?.. regardless of weather they are right or wrong?
Re: How essential is an LLC? - Posted by ray@lcorn
Posted by ray@lcorn on October 15, 2007 at 17:39:50:
George,
That’s a legal question that depends on how the terms of the trust, how it is managed, the size of the assets, and the specifics regarding the properties and the leases.
LLCs are recommended because they are cheap to set up and maintain, are tax-neutral, and protect the property title from personal claims against the owner(s), the tenant(s), and the property (i.e. liens), and vice versa.
Your structure may be fine, but I’d ask the question of a real estate lawyer to make sure.
ray
Re: How essential is an LLC? - Posted by George
Posted by George on October 16, 2007 at 18:15:23:
Unfortunately the property is in California. From the little research I’ve done, I’ve read that it will be a minimum of $800 per year to maintain the LLC.