Hi. Lee Phillips. I want to talk to you
about an issue that comes up quite often I deal with a lot of real estate
investors and as an attorney they always ask me the question Should I use a land
trust to hold my investment property and should I have an LLC? Should I have a corporation? Should it be in my own name? What do I do in order to protect my
investment property? I’m going to talk about basically should I put it in the land trust
or should I put it in an LLC You could put it in a corporation if it
were taxed under subchapter S of the IRS code. You will never have real estate in
a corporation taxed under Chapter C of th IRS Code. A C corporation? The answer’s
no. Maybe an S corporation. But the LLC will give you better asset protection.
It has charging orders and we’ve got YouTubes on what is a charging order. The Land Trust, however a lot of people, a lot of gurus say, oh use the land trust The primary issue of the Land Trust is anonymity and I’ve talked about anonymity
in some of the YouTube vidoss but the Land Trust does not give you any
asset protection and if you back the guru’s into the corner they will say Yeah, it doesn’t give you any asset protection. It doesn’t matter whether you make your LLC the beneficiary or what it does the Land Trust doesn’t give you any asset
protection end of discussion. Period. It’s a revocable trust. So do you put it in the Land Trust or the LLC? I would use an LLC. No, it gives you no anonymity, But it does give you legal asset protection through the corporate shield and through the charging orders and we’ve discussed those, like I said, in
other YouTube videos. However, the Land Trust is easier. I don’t have to pay a state fee I don’t have to register anything I don’t have to do anything just have the Land Trust and title the property. Additionally, the LLC has maintenance. You have to hold your meetings and file your state papers every year and do all this sort of garbage. Land trust? No maintenance. The state fees I kind of alluded to, no state fee in a land trust. State fees with LLCs. California, New York, New Jersey
“them foreign countries” they’re expensive. Every year $850 bucks
in California. So I’ve actually recommended to some people in California let’s use the land trust. Use your land trust, it’s gonna save you a lot of money, and take that money, take that 850 bucks add it to your property casualty umbrella your insurance policies and you will get better asset protection in all likelihood So yeah, do I use land trusts.
Not usually. Are they bad? No. But on the other hand they’re not always what they’re cracked up to be when you talk to the gurus about land trusts. So I would lean towards the LLCs if possible That’s Lee Phillips’s opinion. And I have very good friends who are gurus that use land trusts and we argue about it toe to toe but my thoughts on it anyway.