LLC series structure and anonymous land trusts are tools that have been used by the wealthy for years to protect their assets. At Royal Legal Solutions, we bring this same asset protection to the average real estate investor.
You have probably made real estate investments as a way of earning passive income, something you can depend on when you retire. But we live in a litigious society; one in four U.S. citizens will be sued in their lifetimes, and if you’re a real estate investor, it’s even more likely.
LLC Series Structure Isolates Your Equity
Setting up an LLC Series Structure legally isolates your equity into separate LLCs inside of a holding company, so you will not lose everything in the case of a catastrophic law suit. You can do this with real property but also certain other types of investments such as stock portfolios.
Anonymous Trusts Hide Your Assets
Setting up anonymous trusts as the property owner at the same time you set up an LLC Series, makes it extremely difficult to find all your assets. These anonymous trusts can own the LLC itself as well as serve as title trusts for the real estate asset. They hide the assets from being connected to you or the holding company.
You Are Wide Open to a Losing All Your Assets if You Have Not Insulated Them
Property in your name leaves you open to losing it all: Litigation doesn’t even have to have anything to do with your property in order to wipe you out. If you have property in your name, or even worse, in a general partnership, and are found liable in a car wreck or other random accident, you could lose everything. Insurance is not going to stop a plaintiff from going after anything and everything you own to repay damages for extensive hospital bills or a wrongful death action.
Property in a traditional LLC or corporation isn’t much better: You are in a little better shape if you have all your assets in one traditional LLC or corporation. In that case, law suits against you personally can’t normally touch your business assets. But if you have all your assets in one LLC, and there is a slip and fall at one of your properties that results in serious injury or death, a plaintiff can go after all your properties. It doesn’t matter that your other properties are unrelated to the incident.
Insurance Won’t Protect Your Real Estate Investments
Insurance can help with minor incidents, but it’s not going to save you from losing everything in the case of a big, catastrophic law suit. If someone falls through your stairs and the court finds you are at fault because of the nature of the structure or maintenance, your insurance will likely not cover you at all. And certainly neither your property nor your automobile insurance will cover you if you are found negligent in a serious accident.
The one thing that can save you from disaster is setting up an LLC Series and Anonymous Trusts. Plaintiffs can never reach all of your assets, because they are owned by separate legal entities and never in your name.
Plaintiff Attorneys Won’t Gamble or Chase the Money
Not only does a series LLC structure legally protect your assets, because your equity is in multiple legal entities, but it also discourages most law suits from ever being filed. Attorneys will not take a case unless they know how they will get paid. If equity is held in multiple LLCs set up with anonymous trusts it will appear on a search that you own very little – if anything at all. Attorneys will look elsewhere for an easier pay day.
Plaintiffs need to pay at least $5,000 to even start litigation, and the amount quickly escalates to over $10,000 once discovery starts. It simply does not make sense for a plaintiff to file a law suit when they cannot find any assets that can be seized if they win a damage award.
Setting Up the Ultimate Real Estate Protection is Fast, Cost-Effective and Scalable
You can be fully protected inside of only a week! There is a onetime set-up of the overall LLC series structure. Then when you add properties, all you need to do is SCOTT TO briefly FILL IN. the rest of the sentence.
There is no more work for your accountant with a series LLC. Though there are separate legal entities, there is a holding company LLC which is owned by an anonymous trust. This means there is still just one tax return, one LLC filing, one EIN and one operating agreement. After it is set up, you won’t even notice it’s there in your normal course of business.
Setting up the initial structure is inexpensive considering the massive protection you will get and its infinite scalability. Each property you add after that only costs WHAT and for WHAT?
Sleep better knowing your real estate investments and passive income have full asset protection with an LLC series structure and anonymous trusts.