Do you own a business or an investment real property in a Limited Liability Company, also known as an LLC? You may have completed an estate plan to protect your property and provide for your family’s future, but have you considered your LLC as part of your plan? By transferring your LLC into a trust, you can utilize the estate planning and liability-limiting benefits of both legal tools.
A Limited Liability Company, or an LLC is a type of business structure that protects its owners, who are called “members,” from being personally liable for the company’s debts. It is one of the most common entities formed in New York because, as the name suggests, it limits the liability of the members and provides for flexibility in how its profits are taxed. This business structure combines the characteristics of a partnership or sole proprietorship and a corporation.
A living trust is a legal tool that allows the creator (or grantor) to appoint a trustee to manage the trust’s assets as well as the distribution of those assets when the grantor dies. The living trust is effective during the grantor’s lifetime and holds assets and distributes them according to the grantor’s directions. A living trust can provide a quick, private way to distribute the trust’s assets at the grantor’s death because trust assets avoid probate and are distributed directly by the trustee to the beneficiaries. Living trusts can be revocable or irrevocable and avoid the probate process. Certain types of trusts can shelter trust assets from certain types of creditors (such as Medicaid) while others can aid in limiting tax liabilities (such as ILITs).
The transfer of an LLC to a trust allows the member/grantor to benefit from the advantages of both entities.
If you are wondering whether you should transfer your LLC to a Trust, the estate planning attorneys at the Law Offices of Roman Aminov, P.C. can discuss your options with you. If you choose to pursue transferring your LLC to a trust, you must confirm that the LLC’s operating agreement allows for trust ownership and you will likely need consent from the other members of the LLC if it is a multi-member entity. The process will require transferring the LLC to the trust, updating the LLC documents such as the operating agreement and articles of organization as well as preparing an assignment of interest to effectuate the change of ownership to a trust. The attorneys at Law Offices of Roman Aminov, P.C. can help you through every step of the process and aid you in determining how best to protect your loved ones and your business interests. Call us today at 347-766-2685 for a free phone consultation.
If you need the assistance of an experienced estate attorney, call the Law Offices of Roman Aminov, P.C. at 347-766-2685 to discuss your matter.
This article is for educational purposes only - to provide you with general information, not to provide specific legal advice. Use of this post does not create an attorney-client relationship and information contained herein should not be used as a substitute for competent legal advice from a licensed attorney in your state.
This article is for educational purposes only - to provide you general information, not to provide specific legal advice from Roman Aminov. Use of this post does not create an attorney-client relationship and information contained herein should not be used as a substitute for competent legal advice from a licensed local estate attorney in NY or your state.