Updated December 15, 2020
Real Estate Transfer
If you have established an LLC and you want to transfer a piece of property into that LLC to utilize the real estate asset protection benefits that go along with doing this, there are a couple of things to keep in mind and understand.
First, if a property is paid off then you can easily transfer it to the LLC without the worry of a bank accelerating the loan or creating a “due on” date for that loan. If, however, you do have a lien or mortgage on the property, you should probably not risk transferring it to the LLC because you may be assessed with an accelerated loan payoff. In this case, you need to set up a land trust and then deed that land into the trust with you as the beneficiary. You can then assign the interest over to the LLC. This effectively shields the fact that an LLC is involved to the public, especially the bank.
Regardless of the option you choose, there is a process necessary to properly record the deed into the land trust or directly into the name of the LLC. The first step to do is call your county recorder’s office where the property is located and find out their formatting requirements. This is because many counties have different recording requirements that if you don’t follow will cause the deed to be rejected. You may not even know this has happened for many months because there may be a backlog in the office. You will go on as if you are protected, but in reality, you are not because the deed was not properly recorded.
Additional Forms to Transfer Real Estate in an LLC
There may in some cases be ancillary forms that must be submitted with the deed that has to do with transfer taxes. There may be specific codes on these documents that must be listed when filling out the transfer tax forms to assure that the land is not reassessed when transferring a deed to a trust or LLC.
If you are attempting to have anonymity attached to this transfer, you will want to make sure that the tax forms are not sent to your home or personal address. This would defeat the anonymity aspect because even though your name is not on the deed to the property, it can still be traced back to you via the tax records if your personal address was used. You can avoid this by having the documents sent to someone else or a rented address.
For instance, if you set up a Nevada LLC through a company such as Anderson, you could have the tax documents sent to those offices which would then forward the documents on to you, preserving your anonymity. If you have any questions or are in doubt about this process you should contact a professional to help you in order to make sure everything is handled properly and that you receive the most benefits possible from this transaction.
