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Is a Series LLC or an LLC good for your Real Estate Property?

Real estate owners and investors own their personal or investment real estate in their personal names.  Your homestead property which is your primary residence should never be owned by your Limited Liability Corporation or Series LLC.  Your primary residence should be owed as tenants by entirety, in your Revocable Living Trust, and/or Private Land Trust. 

TENANTS BY ENTIRETY

Tenants by entirety is a way of owning your primary residence in the State of Illinois.  Tenants by entirety is the preferred way to own a home for a husband and wife.  There are a couple of key things.  First, a husband and wife must own the house because tenants by entirety is limited to husband and wives (or legally married persons). 

Second, tenants by entirety property must be your primary residence.  Thus, a husband and wife cannot own two (2) real estate properties characterized as tenants by entirety.  Generally, jointly owned property of a husband and wife that is investment property will be titled as joint tenants with right of survivorship.  As joint tenants, upon one spouse’s death, the other spouse automatically inherits the investment property.

One major difference between joint tenants and tenancy by entirety is creditor protection.  As tenants by entirety, a creditor cannot foreclosure your house if one spouse has liability or creditor problems unlike joint tenants.  If one spouse has creditor problem as joint tenants, the creditor has a legal right to foreclosure their judgment or lien if the husband and wife cannot satisfy the judgment. 

On the contrary, tenants by entirety provide husband and wife creditor problem where a creditor (unless possibly the IRS or another government entity) cannot foreclose on a lien or judgment against only one spouse.  Creditor protection does not apply for tenants by entirety problem when the creditor has a judgment or lien against both husband and wife.

LIMITED LIABILITY COMPANY ATTORNEYS

Sean Robertson and Gateville Law Firm concentrate their practice in assisting real estate owners set up and form Limited Liability Corporations or otherwise known as “LLCs”.  An Limited Liability Corporation is a type of business entity which provides husband and wives limited liability protection separate from themselves.  Unlike a corporation, an Limited Liability Corporation provides more flexibility like a partnership and limited liability protection for a corporation.  Simply put, an LLC is a newer business entity which provides real estate owners and investors flexibility in how they conduct their business venture. 

Real estate owners usually set up their businesses as LLCs because LLCs allow passive income versus corporations.  When real estate owners are flipping properties, which means they are selling properties before they own the property for a year is the exception to the LLC rule.  Generally, real estate owners that flip properties are generally an S corporation.  The benefit of an S corporation for real estate ownership of less than a year is the payroll tax or employer tax liability is much greater under an S corporation versus an LLC.  Generally, real estate ownership where a person or persons (or entity) will own real estate for greater than one (1) year will be set up as an LLC.

SERIES LLC REAL ESTATE ATTORNEYS

A Series LLC and an LLC are like one another.  Real estate investors are recommended to have one (1) LLC per real estate property.  This gets costly and limits the profitability of a real estate investor.  A Series LLC is the same as an LLC with one important exception.  A Series LLC allows a real estate owner or investor to own multiple properties and LLCs for $50 per LLC after the initial purchase of the first Series LLC.  A Series LLC is essentially a group of LLCs that have similar names with the lower costs benefit of setting up multiple LLCs.  Real estate owners who utilize a Series LLC will often utilize a holding and subsidiary company set up. 

Sean Robertson and Gateville Law Firm concentrate in real estate, asset protection, and estate planning for real estate investors and residential homeowners.  Sean Robertson has over 15 years of experience as a real estate attorney.  Sean Robertson has expertise in structuring real estate holding and personal holdings in a cost-effective manner that limits personal and family liability concerns.  Another benefit of a Series LLC is the ability to file one (1) annual report versus multiple annual reports for each LLC.  This is a substantial cost savings because the filing fees for an annual LLC report is normally $250 per year.

EXPERIENCED REAL ESTATE LLC AND SERIES LLC ATTORNEYS

In conclusion, Sean Robertson and Gateville Law Firm concentrate in real estate asset protection and real estate law.  Gateville Law Firm is a real estate law firm concentrating in asset protection and real estate law.  Gateville Law Firm can assist you with the following real estate oriented legal services:

  • Drafting of Quit Claim Deeds, Deceased Joint Tenancy Affidavits, Bills of Sale, and Affidavits of Title;
  • Private Land Trust
  • Drafting of estate planning documents such as Living Wills, Pour Over Wills, Last Wills and Testaments, and Revocable Living Trust
  • Asset Protection for Real Estate Owners and Investors
  • Nursing Home Asset Protection Against Creditor Concerns
  • Set up and formation of Limited Liability Corporations and Series Limited Liability Corporations
  • Financial and Healthcare Powers of Attorneys
  • Limited Liability Corporation Operating Agreements and S Corporation Bylaws
  • Real Estate Flip Transactions
  • Tax Planning for Real Estate Owners

Sean Robertson may be reached via online contact form (best method), email, and/or 630-780-1034.

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Yorkville, Illinois 60560