Question About Land Trusts And LLCs
Hello,
My girlfriend and I have finally made the plunge and are in contract on 2 properties. I have been doing some research and believe the best way to hold these properties is by having each title held by a Land Trust and have the beneficiery of those trusts be 2 seperate LLCs. I beleieve this has to do with the land trusts protecting my identity and the LLC giving me asset protection.
My question is this, if the renter makes their rent check out to the LLC, then don't they know who holds the property? The land trust really doesnt really hide my identity. Should I have the renter make the check out to the land trust and then the trust to the LLC? I am confused. Thanks for your help, this website has been very helpful.
Gates150,
I don't have an answer to you questions, but have some questions of my own.
I have seen several posts here at TCI concerning hiding or protecting your identity through an LLC. Why would someone want to hide their identity? What benifit does it provide with regards to REI? I have set up an LLC for my firm in order to protect my assests in the event of a lawsuit (people will sue you for anything these days and I don't want anyone taking my 1990 nissan p/u with 150,000 miles). But, I am listed as a member of the organization and my address is listed also. So I haven't hidden myself very well.
Wouldn't another way to keep tenents from knowing who you are is to have a property managment company take care of the rent check? I don't know for sure, I'm not in the rental game.
[addsig]
A lot of different opinions on this topic.
I am a believer in insurance. Yes hiding your identity with LLC and Land Trust will prevent some minor lawsuits because you will be hard to find. But when the pit bull severly injures someone on your property, near your property, or across town from your porperty - you need to have insurance coverage, because they are going to find you.
Went to a Land Trust, LLC one day seminar on asset protection last week and the man started with the fact that everyone should have a liability umbrella and that was the single most important thing to have. Then you should worry about Land Trust and LLC for protection. Exactly my point. But another point is that LLC and Land Trust are difficult to to get umbrella coverage for. And if you can get it, you will need a different policy for each Land Trust and LLC. Each land trust, each LLC and you as an individual are usually treated as different entities. Last point is that if you have multiple LLCs you must keep them seperate and not comingle any money between them or with you as an individual or they will not provide you with any protection. They must be treated 100% as a valid LLC. So keep your minutes, file your forms, watch the accounting.
Brenda
Thanks for the reply. I plan on keeping everything 100% seperate. I aslo plan on having an umbrella policy for each LLC. The reason I am asking about the trust and the LLC is mainly a money issue. If the land trust will not hide my identity, then I might as well not spend the money on setting it up and just put the title in the name of the LLC. Is this correct? Should I have the renter make the check out to the LLC? Any other opinions?