Anderson Business Advisors
I'm interested in talking to anyone that has hired Anderson Business Advisors for help with asset protection strategies. This is the firm founded by author Clint Coons who wrote Asset Protection for Real Estate Investors.
I'd like to hear about your experiences, good or bad. I am considering having them help with the creation of LLCs and land trusts for my buy-and-hold investment properties. They were not able to provide references due to client confidentiality.
I have the same interest......................
Ken - I haven't hired those guys but I'd argue a couple things:
1) Too many attorneys in the REI space $ell fear that you need this or that structure in order to protect your assets.
2) Too many investors get scared off by what appears to be something complex -- forming a holding company (whether LLC, LLP, C or S-corp). It's not that complex.
3) Too many investors are under-insured and fail to frequently review their insurance policies.
Bottom line is this:
1) Find a competent attorney that will give you the holding company structure of your choice (talk to your CPA, not your attorney about what is best for you) documents in a word format. It's all broiler plate anyway. You should be able to reuse your docs for each deal you do without having to go back to the attorney for a new op agreement etc.
2) Forming a LLC etc is easy. Don't get scared by the legalese or the crazy attorneys trying to sell something. A LLC is just a bucket for carrying something around. In our case, it's a piece of property. At the same time, USE your holding companies. Make sure you shift an asset into it. I'm frequently shocked by the number of people who maintain rentals in their personal name. Don't forget to run separate books and bank accounts for your holding companies and have an annual meeting.
3) Review your insurance policies frequently. Make sure you have enough insurance personally (umbrella plus good underlying liability in relationship to your net worth) and corporately (same thing - umbrella plus underlying coverage). This is your first line of defense. Your Wyoming/Nevada/Delaware LLC won't do crap for you if a tenant slips and falls. It just hides the fact that you are the owner.
Anyway, final disclaimer: I'm not an attorney or a CPA. I don't pretend to be one even on the internet. This is my advice based on what's worked for me. Don't get scared off by some attorney. Get out there, write offers and do deals.
#5 Investor Mindset Contributor
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- Greenville, SC
Ken, what did you end up doing?
Originally posted by @Mike Dymski:
Ken, what did you end up doing?
Honestly, I haven't done anything yet. I continue to get conflicting advice about asset protection from friends and attorneys I have initial consultations with. I already have one LLC that owns a couple properties. I will likely transfer title of additional properties to this LLC.
@Ken Weiner I am also in the same boat. I will be talking to one of their attorneys next week.
Any feedback from someone who have worked with them will be appreciated....
thanks!
@Ken Weiner and @Kumar Paj,
We had a short consultation with Anderson Business Advisor last week. I am still researching their legal plan (reviewing online comments, video, and BBB ratings); and, would also appreciate your feedback if you decide to hire them.
Keep us posted and I will do the same. Thanks.
From Nancy
@Ken Weiner @Nancy E. thanks for your note...
I also had short consultation with their advisor last week and not sure if the strategy he was recommending is the right one for me. Still waiting for his email describing in detailed options and pricing. I am meeting an another attorney tomorrow and see what he recommends..
will keep you posted...
I can imagine the cost of maintaining these structures is also a big (ongoing cost of legal fees, LLC entity renewal fees, etc).
Can someone who has done for this share some of the insight on this
What do you want to protect your assets from? Big jury award in a personal injury type lawsuit, or spouse and/or children wresting control away from you when you get older, or one bad deal for one property bleeds over the makes the others vulnerable, or you find yourself unable to pay huge tax liability at some point and want to be judgment proof on paper so IRS cannot seize assets and has to do an offer in compromise with you?
what's the best way to protect from injury lawsuits or frivolous tenant cases? I currently have umbrella insurance and 2 CA LLCs with a holding company in NV. I signed up with Anderson about 6 yrs ago and that's what they recommended at the time. I called them today because I was tired of paying maintenance fees for my CA LLCs and wanted To dissolve them. Today they advised dissolving my CA LLCs in favor of 2 Land trusts and 2 WI LLCs. They'll all be held by another WI LLC (by transferring my NV holding LLC to WI). Does this sound like a good idea?
Sounds really expensive and unnecessarily complicated. A land trust should be a fairly simple process. You can have a natural person or LLC as the beneficiary - the choice between the two is one of tax liability as they are pass through entities; not civil liability. Your protection from civil liability comes from the land trust itself holding title to your real estate assets. The trusts are individual entities just like you and I are completely separate individual entities so the liability (judgment) incurred from by one trust due to a tenant issue at one rental will not bleed over and attach to your other rentals. If you are wholesaling I would recommend an LLC as a holding company, but that should be a very simple straight forward corporation formation process.
@Ken Weiner I, personally have not hired Anderson Advisors, but I have attended their Asset Protection seminar which was very educational. However, I've spoken with them 3 times since the seminar in December to see if it's a "fit", and unfortunately, if you don't sign up for their Platinum PKG at the seminar, the information via phone call, is hard-sell, with alot of info. without info until you sign up. I almost went for the Platinum package, but when I inquired more on complete details about what it covers, and if it would all encompass tax assistance, CPA, legal advice, transfer my IRA's into a QRP, etc. for the price of $2995/year and $35/month, they said NO. I'd have to get another program for QRP at $5,000/year. I was left with the impression that if I sign up for the Platinum, then that was just to get me in the door with access to attorney questions anytime, but tax assistance was an additional cost. Agreed @Laura Richards, it seems a bit excessive in cost and unnecessarily complicated, and I personally would not recommend for a beginner. Unless someone is well established in their business, I would start small until you've got the money and assets to digest those kinds of fees. I'm sure Anderson is great - but for those more established.
I too, have an appointment with Anderson Advisors tomorrow, but based on the insightful responses here on the BiggerPockets forum, I would have to agree, especially for my situation that I may need to be a bit more established before taking on a "Platinum" commitment of any kind. And a special thanks to @Sheryl Griffin for shedding a bit of light on this vendor.
"Does this sound like a good idea?"
Unless you have a very specific reason to do this - no. Otherwise you will continue to restructure like a hamster wheel spins - and waste $$.
Beware that a holding company or LLC in NV will not deter local (out-of-state) statutes unless whomever you contracted with signed away their local rights favoring NV law. Many states require you register your company with their SOS (or equivalent) for that very reason.
"They'll all be held by another WI LLC (by transferring my NV holding LLC to WI)."
Looks like a mutation and continuation of the original shell game (NV holding with CA LLCs). Again, what is your s-p-e-c-i-f-i-c reason for doing this? "The attorney said so..." is NOT a reason.
Although your structure will buy you some time, if the "frivolous" lawsuit has some merit and possible $$$ behind it, an aggressive attorney WILL force you to respond. In layman's terms, you can run for awhile but not "hide" as we commonly think the word means.
Source:
https://www.keytlaw.com/azllclaw/forming-llcs/nevada-incorporation-scam/
I feel the same hesitation many of you have. However, I want to set myself up right from the outset. Sure, I'm a complete newbie but I'd rather have all my ducks aligned on the asset protection and tax-wise side of things before leaping ahead. I had a call with Anderson. Their costs are crazy high. 12k for essentially all their services for life (excluding the costs for each LLC, trust, etc.). So, I suppose I'll go around asking more questions but it seems that setting everything up right at the beginning is the best thing. What do you think @Sheryl Griffin?
Originally posted by @Josh Smalley:
"it seems that setting everything up right at the beginning is the best thing. What do you think" @Sheryl Griffin?
I agree, Josh, that is the best way to get in to this business...get everything set up so you're ready to make deals and have everything in place. Especially the LLC and business bank account. If you're looking to make offers and then use a Private Lender or Hard Money Lender, they're almost always going to ask for your LLC and Articles. It's protection for you. Better to be prepared than to get into a deal and have to lose the deal, because you weren't better prepared.
To Whom It May Concern,
My wife and I have been a real estate investors for 3 decades. We met Clint Coons and his team over 10 years ago at a Robert Kiyosaki event in Florida. We have grown with Anderson Advisors as they have grown over the years. Clint Coons, Toby Mathis and the team have provided the best asset protection we could ask for.
These guys are the real deal and they know the industry because they have done and do real estate themselves. They know from experience what we need and they promptly address our concerns regarding all aspects of our business. Our real estate portfolio is primarily in Virginia and California. Two very different states legally.
Clint and Toby have guided us through the building of our corporation, numerous LLC's, and other entities. We expanded with Anderson to do our bookkeeping along with our business and personal taxes. We strongly feel that our assets in our estate and business are well protected and cohesively developed.
We sleep well at night as these guys continue to educate us on how to constantly improve our business in many aspects.
Yes, we would highly recommend Anderson Advisors for asset protection and many other aspects of a successful growing business.
Bob & Sue Wolf
I just signed up for the Titanium VIP Service. I will update you on how well its going in about 30 days
Originally posted by @Quenton Mullins:
I just signed up for the Titanium VIP Service. I will update you on how well its going in about 30 days
"Titanium VIP Service" - I can't tell if that's a joke or not. Is that really a thing they are offering above their "Platinum" service?
It is. It gives you everything the platinum service offers plus unlimited LLC creations (one property/LLC), personal property Land Trust, Living Trust, Wyoming holding company and a host of other perks for life.
Let me add my 2 cents here. A glowing post from someone who has only one post on the entire site is actually useless and I would encourage folks to not rely on it. Anyone can form an account, but why would your only post or only 10 or so posts be about helping someones business? Most folks get on this site to learn, not give a reference for a business. It may be a credible post by a real person who has no interest in the business, but it is not likely.
If you want to check the credibility of someone giving a recommendation look for folks with thousands of posts who have proven their competence and experience. Their credibility gives a recommendation value. I see no posts of that caliber in this thread.
Please note that its too early to give the Anderson group a glowing post. Either I have just wasted a lot of money or I have made one of the most wisest decisions when it comes to asset protection, access to tons of contracts, accountants and attorneys.
I am fairly new to bigger pockets and the real estate investment world. I am a H&W Regional for Wal-mart Inc (See my Linkedin page). I travel almost every week over 6 plus states, very hard to post every other day. Hence, I am looking to generate more time for church and family! Since I am new here and really want to add value to any and all investors I come in contact with, I am willing to share my experiences with the Bigger Pockets family. This has been my experience so far;
Sr. Strategist = Seth Perlman.
Seth's Assistant = Chance Truscott
After I paid, they sent me over my proposed structure, which included Holding LLC, Living Trust, C-corp, LLC in each state (1:1). I am willing to share these emails with anyone if you would like to see the details. This would have been very helpful in defeating my fears.
They will have all of these entities up and running before weeks end. Also, they will place my personal home in a land trust. I am keeping my fingers crossed, but so far, they have been right on time and holding to their word.
On another note, I just visited with Jered Sturm who started our North Atlanta Real Estate Meetup. He introduced a speaker, Vincent Crane who was awesome. I offered to share all of my resources to anyone in my group that I am afforded from the Anderson group. I want to give as much as possible because I know if will add value in my relationships and professional growth in this new venture. I welcome any words of wisdom along the way.
It's interesting that they advised you to create a C-corp. What was their reasoning behind that? Seems like a lot of extra overhead vs. an LLC. Normally I hear of the holding company being created as an LLC, but electing to have that LLC taxed as an S-Corp. (Speaking as someone who's not yet formed _any_ entity, so grab your salt)
This article seems to match what I've read/heard.
How Can I Change My LLC Tax Identity
I will update you as I continue to learn. Anderson group provides corporate headquarters services for my structure(s), hopefully this will control the overhead. The holding company will be the shareholders of the C-Corp. We will be able to do some creative things with 401k, insurance (100% reimbursed), etc. We will only have one Scheduled K on tax returns.
My next meeting is tomorrow at 2:30pm, then after the holidays.
I've worked with Anderson in the past and have nothing but good things to say about them. Very responsive, very knowledgeable. There might be cheaper options, but it's important to remember that you often get what you pay for.