selling your house to your llc

User Forum Topic
Submitted by truongphu on April 14, 2009 - 9:20am

Can anyone please point me to some info regarding selling your house to your newly formed llc ? Thanks.

Submitted by 4plexowner on April 14, 2009 - 1:13pm.

You can transfer your house to an LLC that you and your family control 100% - this is not a sale but a transfer

If you are talking about the LLC obtaining a mortgage in order to buy the house I don't know how you would go about doing that - the LLC would have to have a documented income stream

Submitted by DataAgent on April 14, 2009 - 1:22pm.

If you sell (transfer) your home to your llc (or any legal entity), your lender may demand immediate payment of your mortgage:
http://www.notecircle.net/content/due-on...

Submitted by Noob on April 15, 2009 - 9:09am.

I own property outright, but want to transfer it to my family trust. I'm single and don't have any dependants, but I want to avoid probate and use any assets I have after I die to fund family education grants.

What is the process for setting up a trust and transfering an asset into it. Is this something I can do myself without a lot of expense?

How do I get the name on the deed changed to the trust name?

Submitted by UCGal on April 15, 2009 - 9:15am.

Noob wrote:
I own property outright, but want to transfer it to my family trust. I'm single and don't have any dependants, but I want to avoid probate and use any assets I have after I die to fund family education grants.

What is the process for setting up a trust and transfering an asset into it. Is this something I can do myself without a lot of expense?

How do I get the name on the deed changed to the trust name?

When we had our trust set up, it was a simple quick claim to transfer the house to the trust. We had it done as part of setting up the trust. (So the lawyer handled it.)

Submitted by 4plexowner on April 15, 2009 - 9:38am.

You need legal / tax advice - not anonymous blog advice

Changing the name on the deed to the trust name could be as simple as filing a Quit Claim deed where you are the grantor and you grant the real property to the trust - fill out the form and take it to the County Recorder's office for filing - Nolo Press probably has guide books and forms to help do this

There is a form that you fill out to file the Quit Claim - it will ask what type of transfer is being accomplished - a transfer from you to a trust controlled by you should not trigger any tax consequences but again, I'm neither a lawyer or a CPA - what you want to avoid is having the property re-assessed at its current value which would result in increased taxes (unless you bought from 2003-2007!)

Setting up the trust is a separate issue - there are several different types of trusts and they accomplish different things - since real estate is involved I'd want to be very clear about managing / controlling the property from within the trust - again, I'd go to Nolo Press as a starting point - they will have the guide books and forms - even if you decide not to do the forms / filing yourself, you will save time/$$$ at the lawyer/CPA's office if you have done some research ahead of time

Something else to consider: unless you have over $3.5 million in assets when you die there are no estate taxes so money spent 'avoiding probate' might be money wasted - the trust could, however, be used to specify exactly how the property is managed after you pass on even if you don't exceed the $3.5 mil marker

Submitted by gn on April 16, 2009 - 12:12pm.

UCGal wrote:
When we had our trust set up, it was a simple quick claim to transfer the house to the trust. We had it done as part of setting up the trust. (So the lawyer handled it.)

UCGal, how much $$ did you pay to transfer the house to the trust ?

Submitted by Sandiagon on April 16, 2009 - 12:43pm.

You can use www.legalzoom.com
You can create living trust through them.

Submitted by sdduuuude on April 16, 2009 - 3:33pm.

Noob wrote:
I own property outright, but want to transfer it to my family trust. I'm single and don't have any dependants, but I want to avoid probate and use any assets I have after I die to fund family education grants.

What is the process for setting up a trust and transfering an asset into it. Is this something I can do myself without a lot of expense?

How do I get the name on the deed changed to the trust name?

I had my trust done here:
http://www.walterstrustinfo.com/

Even if you don't use them for your trust, it is worth going to their free workshop. There is a sales pitch to sign up for the trust that night, but it isn't high-pressure and there is much to learn.

4plexowner - there are many goood reasons to avoid probate other than taxes. Even the probate process costs money - they have to pay a probate attorney to manage the case - so avoiding it can save thousands even for small cases. Also, trusts execute immediately. Probate can drag on for years.

A trust - and associated documents such as a will, power of attorney, and other instructional documents - can help your family avoid major problems if you are ever declared incompetent.

If you are declared incompetent and you haven't made it clear who should take over decisions for you, life can be hell for those you leave behind who may have to watch the government step in and manage your life.

There are so many reasons to go to one of those workshops.

Submitted by UCGal on April 16, 2009 - 3:32pm.

gn wrote:
UCGal wrote:
When we had our trust set up, it was a simple quick claim to transfer the house to the trust. We had it done as part of setting up the trust. (So the lawyer handled it.)

UCGal, how much $$ did you pay to transfer the house to the trust ?

It was part of the entire trust/wills/etc package.

Not the cheapest in town, but the lawyer gave good advice. We used http://www.ruylebrewer.com/.

Our situation involved a couple of complications that made us less comfortable with going with a boilerplate service like LegalZoom - but they are fine for non-complicated family trusts.

Submitted by sdduuuude on April 16, 2009 - 3:34pm.

I have always wondered this -

Why doesn't everyone in CA buy a house under a corporation, then sell the corporate stock to the new owner to sell the house.

Wouldn't this avoid a property tax basis reset?

There has to be some trigger in the stock sale or something or this would be commonplace. Does anyone know ?

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.