Will LLC impact step up in basis?
I was planning to put our rental property in an LLC to add another layer of protection so our personal assets aren't exposed to lawsuit judgements involving the rental.
I have been advised to just rely on landlord/property insurance and Umbrella policies but I want that extra layer that an LLc brings.
My question involves whether the rental being in an llc (owned by my husband and I) would mean a surviving spouse or our sons (if we both croaked) would Not be able to get a step up in basis. The tax rules regarding the step up in basis seem to be very dependent on how the property is held and I'm concerned that an entity would cause an issue (even one considered a disregarded entity which Ive been told this LLC would be).
This is a question that requires a level of tax expertise that I dont have so I appreciate if anyone has experience this knowledge and could provide me with some input or places to research it further myself.
Thanks in advance.