Single Member LLCs Asset Protection

[Diane Tycangco]

Hello everyone, I was told by an attorney that the corporate veil of a single member LLC is easier to pierce and thus has less asset protection and charging order protection than a multi-member LLC. That's why he told me to have an LLC with me as one member and an irrevocable trust as a 1% member. This irrevocable trust would then have a charity as the beneficiary because I don't want family members to have anything to do with my properties/business entities.

Is it true that a single member LLCs have less asset & charging order protection?  Is this type of arrangement the right approach for me to have asset & charging order protection for me and my properties?

To save on taxes, should the LLC be taxed as a partnership, S or C corporation? It would hold rental properties and I have a W2 job, I am single with no dependents.

Thank you so much!

[Chris Seveney]

@Diane Tycangco

Taxes speak to your cpa

I would disagree with the attorney on the LLC and asset protection. You either run it like a company or you don't and that is what determines it not how many members

A judge won’t look at it and say “oh because 1% is owned by X we can’t allow the veil to be pierced”