Posted by Rob FL on January 14, 1999 at 17:21:45:
How about filing a fictitious name. Jim Piper could file a fictitious name as John Smith. Then you could own properties as “John Smith, trustee of 123 Elm Street Trust”. It might make things difficult to track back to you since creditors would be looking for John Smith instead of Jim Piper and they probably would not even think to check for a fictitious name on such a common name.
LLC? for rental properties - Posted by Charlie (Fla)
Posted by Charlie (Fla) on January 12, 1999 at 21:06:05:
Friends,
I recently have become aware of LLC’s. I have secured numerous rental properties over the last few years. I am
now in a position to become concerned about my personal liability on these properties. Also, what if any are the tax
benefits/liabilities.
I would greatly appreciate hearing from other individuals on this topic. Alternately, if members on this forum have suggestions other than the LLC please forward creative thoughts.
Sincerely,
Charlie
Re: LLC? for rental properties - Posted by JPiper
Posted by JPiper on January 13, 1999 at 01:38:27:
I’m in the process of putting several properties into LLC’s. I too would recommend separate LLC’s for each property if this is feasible.
There are several articles written by Bill Bronchick about LLC’s on this site. I would recommend them. I recently purchased his course on LLC’s as well. I would recommend that too. With the course you can form these LLC’s very inexpensively.
JPiper
Re: LLC? for rental properties - Posted by George
Posted by George on January 12, 1999 at 22:53:33:
I’m not sure if FL is the same as NJ, but my attorney recommends multiple LLC’s. It limits your liability in case of a lawsuit to only the assets of the particular LLC involved. In other words, if someone got injured in your SFH in Ajax LLC, they couldn’t touch your apartment building in Acme LLC. It basically gives you the same protection as a corporation, but without the tax liabilities of a corporation. All profits and losses from the LLC flow right through to your individual tax return. Another way I’ve heard to protect your assets/properties, is to set up a holding company. The holding company does not do business with the general public, therefore is unlikely to be sued. The holding company simply holds a lien on everyone of your properties that is equal to the equity. An attorney is not going to waste time suing you, because there is no equity in any of your property.
Land Trust? - Posted by Kev (NC)
Posted by Kev (NC) on January 13, 1999 at 14:22:57:
Jim,
I am in a similar situation. Since I have financing on the properties I was planning on dropping the properties into land trusts and changing the benificiary to the LLC to avoid triggering the DOS. Is this how you are going to do it - or is there a better way? (I am following the advice in Bronchick’s courses.)
Re: Land Trust? - Posted by JPiper
Posted by JPiper on January 13, 1999 at 21:01:08:
kevin:
That sounds like a good idea. I’m starting by simply deeding to the llc because the loans I have on the properties involved don’t have due on sale clauses.
JPiper
Re: Land Trust? - Posted by Bud Branstetter
Posted by Bud Branstetter on January 14, 1999 at 01:42:48:
Jim, If you used the land trust first it gives you that first layer of anonimity. If I were suing you I would find out all corp./LLC that you had through the SEC of State. If I got a judgement against your LLC then every property in that LLC would be tied up until it were cleared. If it were in the land trust I have to wait until I get the judgememt and do discovery to find out what you own. By that time it will be long gone beforehand.
If you use the land trust first you can shift between LLC or other entities without going public. While individual LLCs may seem a good idea, at least here it is 200/person(min 2) per year.
Re: Land Trust? - Posted by JPiper
Posted by JPiper on January 14, 1999 at 02:26:02:
Bud:
Here’s how I have analyzed the LLC issue.
In my state there is no way to do a name search of what LLC/corp interests I have. If you know the name of my corp you can search and find out I am an officer. If you know the name of my LLC…same thing. But if you know my name, you can’t search for the LLC/corps I have an interest in. Or that’s what the state tells me.
Having said this, I agree with your point on the land trusts. My problem is that in the past I have used my corp as the trustee of my land trusts (they were only for purposes of DOS clause). Now as I contemplate some asset protection I wonder about the value of having my own corp the trustee, a corp that can be checked out at the secretary of state. Other possible trustees either don’t want to do it, or are too expensive. Do you have a suggestion or solution to this issue??
The LLC seems like a good solution, with or without the land trust due to the charging order methodology and the fact that my personal name can’t be searched at the secretary of state. Here the cost is $105 per LLC in one time fees. No annual renewal fees, which seems moderate.
JPiper
Have you investigated…? - Posted by David Alexander
Posted by David Alexander on January 15, 1999 at 21:36:26:
Maybe setting up an out of state Corp. (Neveda)
Nobody would know who owns that. It could serve the purpose also of a management company to spread income.
David Alexander