Howey Test (pass or fail)

[Daniel M.]

Hi! What's the minimum a partner needs to do in an LLC (owning rental property) to be considered active enough to avoid it being labeled an investment security under the Howey Test?

[Jay Hinrichs]

can be subjective.. However I think if you have the memeber be a managing member you can have more than one manager.. then I think that works to satisfy the test.  if they are not then you will run up against howey.