My own LLC as Trustee - Posted by Ravi

import · January 25, 2001, 4:42am

Posted by Randy M on January 25, 2001 at 19:29:39:

Bill’s fingers are sore from counting money…Ha…

import · January 25, 2001, 4:42am

Posted by Ravi on January 25, 2001 at 05:42:15:

THANKS GUYS.!!!

I really appreciate your excellent insight and commentary on my earlier posting.

I am extremely interested in privacy?.but like any astute investor, I want to protect my financial resources as well. This is why I proposed in my earlier posting forming an out-of-state LLC to serve as trustee for my trust properties (for maximum control and maximum privacy). The beneficiaries of the land trusts would be other LLC’s (for maximum asset protection).

I think the gist of my question was: is there any potential fallout from the trustee LLC not being a ?State Qualified Trust Company? (as required in every state), since this ?trustee? is only a vehicle for my use?not for holding titles for the general public who require fiduciary protections.

Again, I equate this to forming a corporation to manage real estate without obtaining a real estate broker license. This is legal if the management company only manages my property, but it is illegal in every state to manage property for others, without obtaining a real estate broker license. This is for the protection of the general public.

Since my ?trustee? would not be dealing with the public, it seems I could apply the management company principle to my situation, and have 1) maximum privacy, 2) maximum control (since I own the “trustee” entity) and 3) maximum asset protection. What do you guys say?

import · January 25, 2001, 6:19pm

Re: My own LLC as Trustee - Posted by Randy M

Posted by Randy M on January 25, 2001 at 19:19:36:

Hi Ravi,

I think ultimately what you are talking about could cause you trouble IF - I repeat - IF there were some sort of financial trouble or if you passed away with an estate that owed federal estate tax.

You have to be extremely careful in an irrevocable trust to not have any incidence of ownership. So - if your trust owns the property and you are beneficiary and also own the LLC that is trustee, you have an incidence of ownership. You control the entity that is trustee, so ultimately you have power of appointment. Under those two scenarios I listed above, this would NOT be desirable.

Would be a lot different, however, if you weren’t beneficiary. Perhaps your trust could have your wife (as long as she was married to you) and children as beneficiaries. Then you could be the grantor of the trust and the trustee.

Good luck.

Randy M

import · January 25, 2001, 9:54am

Re: My own LLC as Trustee - Posted by Bill Gatten

Posted by Bill Gatten on January 25, 2001 at 10:54:31:

My understanding is that you can use you own LLC as a trustee.

The indivudal state requirements relate, as you say, to business entitites holding title for unrelated entities. However private parties, partnerships, LLC’s and non-profit corporations acting for the benefit of their members can hold title for their own interests.

Bill Gatten

import · January 25, 2001, 6:02pm

Hey Bill,Whats up?Outta Breath? - Posted by TC

Posted by TC on January 25, 2001 at 19:02:16:

This has to be one of the shortest replies I have ever seen you post,not that we dont enjoy the long replies.They are very entertaining and educational.Keep up the good work!

import · January 26, 2001, 10:07am

Re: Hey Bill,Whats up… - Posted by Bill Gatten

Posted by Bill Gatten on January 26, 2001 at 11:07:19:

Confuscious say: “Reply to post like weiner…unless long, not good enough for Dodger Dog.”

Bill G