What is a "Single member LLC" - Posted by Jeff M

Posted by JHyre in Ohio on February 16, 2002 at 05:51:50:

SMLLC is an LLC with only one owner. Most states treat them like normal LLCs, except that the ability to protect oneself via charging order in a lawsuit is questionable. The IRS completely ignores SMLLCs…from their standpoint, it’s as if the owner were doing everything that the LLC in fact did. So you get some liability protection, but simpler tax treatment.

If you purchase in your name, you can transfer to entities later on, but it tends to be a pain for two reasons: bank permission or refi is needed (though if you see how land trusts work, you could probably get around the bank covertly) and loss of privacy. It is best to purchase in land trust’s name, and make your entity the beneficial owner of the land trust from the get-go. See the following articles for more info and then come back with more specifc questions:

http://www.creonline.com/articl56.htm (corporations)
http://www.creonline.com/articl62.htm (LLCs)
http://www.creonline.com/articl53.htm (why trust helps move financing, part I)
http://www.creonline.com/articl71.htm (trusts & Due on Sale, part II)
http://www.creonline.com/articl96.htm (minimizing liability)

John Hyre

What is a “Single member LLC” - Posted by Jeff M

Posted by Jeff M on February 14, 2002 at 22:03:55:

Bill and/or John:

I was reading a thread down lower where you refer to a single member LLC. What is that, and what are its benefits?

Also, I wish to purchase some property I have seen, and have run the numbers on. I have not yet gone to a lawyer to set myself up as an LLC or a Limited Partnership althoough I do have an existing Linited Partnership for another business venture. If I purchase this property in my own name, or JT with my wife and kids, can I transfer it later into whatever vehicle my lawyer were to set up? Would this cause the loan to have to be re-done, with all of the costs of the original loan, or would a bank simply transfer the loan? I know I need to “get up to snuff” on the asset protection part of this, but I would hate to miss out on this property. Any suggestions would be appreciated. Thanks in advance.

Jeff M