It is not an entirely unusual scenario: after creating an estate plan several years before, an individual decides to purchase a rental property. Now that his assets have changed in a significant way, it is important to sit down with your attorney to discuss an update to your estate plan. He or she may suggest that you place the new rental property into a limited liability company (LLC) for asset protection purposes. Fortunately, it is not difficult to carry out this action.
Five Easy Steps for Transferring a Rental Property to an LLC
Are you wondering about the mechanics of moving a home from your name individually to the business name? Follow the below steps:
- Set up the new limited liability company. You will need to choose a name for your new LLC. You will also have to decide whether you want to set up the new LLC in California or another state. If you do choose another state, it is important to discuss your reasoning with your attorney.
- Draft a new deed. The new deed will transfer the property from you as an individual to your LLC.
- Record the new deed in the county recorder’s office.
- Consult with your attorney about whether you should create your operating agreement at this time, or if it can wait a little longer.
- Confirm that the deed was recorded.
It is not an entirely unusual scenario: after creating an estate plan several years before, an individual decides to purchase a rental property.We hope that this article answered your question about putting rental properties into LLC’s. For more helpful tips, we encourage you to sign up for our free newsletter today. We provide valuable information about estate planning, modification, and administration to our readers.For more info please call or email our office today.