Forming an LLC in Houston TX
Investor · Los Angeles, CA · Member since 2015 · 37 posts · 5 votes
Just a little lost on how to form a sole proprietorship LLC in Texas, wondering if someone knows the cost and some basic knowledge on how to start with this? New at investing and everyday seems I find something new and a new question, I'm really trying to make my first purchase or wholesale as cautious as possible
We are using a lawyer well known in the real estate industry: Steve Newsom at 281-829-2074 or email: [email protected]
Here is an article about him: http://businessinnovatorsmagazine.com/steve-newsom-houston-real-estate-attorney/
well as I don't have the money to pay an attorney upfront, I will form an LLC, do some whole selling and then get the necessary protection needed, I believe its the best route for me and my situation, now comes the hard part a name lol, since an LLC can be used in other types of business, I just want a name that is not directed towards home investing but rather something in general
If you aren't going to do it in a way to actually provide protection why bother spending the money on the LLC in the first place? What benefit are you receiving?
you will have protection but not fully, that is what I gathered, an LLC will protect you but if you have a competent lawyer then it won't be that hard to pierce through the umbrella
You need the competent lawyer when you form the LLC. Not do a bad job forming one on your own and then hire the competent lawyer later.
well as I don't have the money to pay an attorney upfront, I will form an LLC, do some whole selling and then get the necessary protection needed, I believe its the best route for me and my situation, now comes the hard part a name lol, since an LLC can be used in other types of business, I just want a name that is not directed towards home investing but rather something in general
If you aren't going to do it in a way to actually provide protection why bother spending the money on the LLC in the first place? What benefit are you receiving?
you will have protection but not fully, that is what I gathered, an LLC will protect you but if you have a competent lawyer then it won't be that hard to pierce through the umbrella
You need the competent lawyer when you form the LLC. Not do a bad job forming one on your own and then hire the competent lawyer later.
sorry a need to rephrase my answer, I meant it the plaintiff has a good competent lawyer, than they could pierce through the umbrella policies easy
well as I don't have the money to pay an attorney upfront, I will form an LLC, do some whole selling and then get the necessary protection needed, I believe its the best route for me and my situation, now comes the hard part a name lol, since an LLC can be used in other types of business, I just want a name that is not directed towards home investing but rather something in general
If you aren't going to do it in a way to actually provide protection why bother spending the money on the LLC in the first place? What benefit are you receiving?
you will have protection but not fully, that is what I gathered, an LLC will protect you but if you have a competent lawyer then it won't be that hard to pierce through the umbrella
You need the competent lawyer when you form the LLC. Not do a bad job forming one on your own and then hire the competent lawyer later.
sorry a need to rephrase my answer, I meant it the plaintiff has a good competent lawyer, than they could pierce through the umbrella policies easy
You're confusing umbrella policy with coprorate veil.
well as I don't have the money to pay an attorney upfront, I will form an LLC, do some whole selling and then get the necessary protection needed, I believe its the best route for me and my situation, now comes the hard part a name lol, since an LLC can be used in other types of business, I just want a name that is not directed towards home investing but rather something in general
If you aren't going to do it in a way to actually provide protection why bother spending the money on the LLC in the first place? What benefit are you receiving?
you will have protection but not fully, that is what I gathered, an LLC will protect you but if you have a competent lawyer then it won't be that hard to pierce through the umbrella
You need the competent lawyer when you form the LLC. Not do a bad job forming one on your own and then hire the competent lawyer later.
sorry a need to rephrase my answer, I meant it the plaintiff has a good competent lawyer, than they could pierce through the umbrella policies easy
You're confusing umbrella policy with coprorate veil.
ah correct I apologize, yes I meant corporate veil
Do you have any case law that you can share with us that says that having a LLC protected somebody assets other than having a really high umbrella policy?
Last one I was reading lately was Shook v Walden, a Texas third court of appeals case. Probably not applicable to your situation. But, there are hundreds if not thousands of cases about LLCs protecting Members. High Umbrella policies may actually encourage litigation against you (the Plaintiff's lawyer knows someone will be paying), OR your high umbrella policy may not cover your issue. You'd probably be amazed at the things insurance polices won't / don't cover.
This case does not pertain to me. Please provide a case that pertains to landlord tenant relationships in which it involved injury or something else tenants sue landlords for.
Thanks
I won't be able to give you a California case. I'm a Texas lawyer, not a California lawyer and I don't have California subscriptions in my research packages. As far as Texas goes, the case I gave you is relevant as it discusses piercing the veil and how strong the LLC protections are in Texas. Piercing the veil is piercing the veil; it doesn't matter that the case wasn't about landlord-tenant law.
welcome to BP. I think you might need to listen to some of the shows which have people talk about attorneys and corporations. I believe in asset protection and am risk averse. I do not have the time or the wherewithal to pretend to be a lawyer in my spare time to try to form an asset protection structure on my own and keep up to date with all the rules and regulations required to be compliant and within tax law. Therefore, I chose to use a set of attorneys and CPA's to handle that for me. They alert me to new changes in the tax law and when I need to do certain things to reduce my tax liability. However, they are not cheap and maybe less expensive than Steve Newsome. I know he's supposed to be pretty good. In my opinion, you get what you pay for in protection so don't go cheap.
Use someone familiar with real estate law and with asset protection. Most people here like the book Rich Dad, Poor Dad. I love it and I like a lot of their other books. I suggest this one: Own Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them (Rich Dad's Advisors) by Garrett Sutton. You may find that a sole proprietorship LLC may not be in your best interest or it might be the perfect structure.
I hope that helps. Let me know if you have any questions.
Hey Juan, I got in late to the conversation and I don't know what you guys have discussed or even if you already have formed an LLC in Houston, but I met a very knowledgeable lawyer that specializes in forming corporations and all about asset protection in Texas. He's actually a BP member and has done a podcast for Josh and Brandon (unfortunately i can't remember the podcast episode). His name is Scott Smith. Reach out to him if you'd like to learn more.
Good luck and to your success!
Xavier
welcome to BP. I think you might need to listen to some of the shows which have people talk about attorneys and corporations. I believe in asset protection and am risk averse. I do not have the time or the wherewithal to pretend to be a lawyer in my spare time to try to form an asset protection structure on my own and keep up to date with all the rules and regulations required to be compliant and within tax law. Therefore, I chose to use a set of attorneys and CPA's to handle that for me. They alert me to new changes in the tax law and when I need to do certain things to reduce my tax liability. However, they are not cheap and maybe less expensive than Steve Newsome. I know he's supposed to be pretty good. In my opinion, you get what you pay for in protection so don't go cheap.
Use someone familiar with real estate law and with asset protection. Most people here like the book Rich Dad, Poor Dad. I love it and I like a lot of their other books. I suggest this one: Own Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them (Rich Dad's Advisors) by Garrett Sutton. You may find that a sole proprietorship LLC may not be in your best interest or it might be the perfect structure.
I hope that helps. Let me know if you have any questions.
@Juan Perez
Hey Juan, I got in late to the conversation and I don't know what you guys have discussed or even if you already have formed an LLC in Houston, but I met a very knowledgeable lawyer that specializes in forming corporations and all about asset protection in Texas. He's actually a BP member and has done a podcast for Josh and Brandon (unfortunately i can't remember the podcast episode). His name is Scott Smith. Reach out to him if you'd like to learn more.
Good luck and to your success!
Xavier
Good deal guys, thanks for all the offers, was great advice