All Forum Posts by: Brian Bradley

@John Hyre @Michael Plaks go buy the law book I told you to get. Hmm. or ur lazy. don't need to like it or agree. Go read. Sounds like you have something personal about a legal entity. Strange. Don't care if you like saving money or not. Or want to try to understand it or not. Seems like pessimism with sarcasm and hidden agenda is driving you. Top Asset protection firms in nation Lodmell & Lodmell use them along with other corporate structures, Asset Protection Planners the oldest and most establish firm in asset protection use them and others and they have been around for over 100 years. Royal Legal Solutions uses them, Willcox & Savage, PC, Holland & Hart LLP, snell & Wilmer LLP, etc, etc and etc so please stop your pettiness. Sorry it works bro. Apparently when somebody actually even gives you the title of a law book with case law that is not even good enough for you. Go read. An entire half section of the law book is devoted to the topic of AP and specifically the Series LLC. Not worth re-typing a book when you can get it yourself.

Also look at DEL. CODE ANN. tit. 6, § 18- 215(b).; V.T.C.A., Bus. Org. Code § 101.606(a). G Management LLC v. Young Brothers and Co., Inc., 2007 WL 551761 (D. Me. 2007); GxG Management LLC v. Young Brothers and Co., Inc., 2007 WL 1702872 (D. Me. 2007); National Securities Series- Industrial Stock Series v. Commissioner, 13 T.C. 884 (1949), acq., 1950-1 C.B. 4. ; and the list goes on and on and on. 

So this is a waist of time.  you want me to email you a 50 page information legal docket then email me and I will send it to you. and You can go purchase the book i mentioned yourself though

@Michael Plaks no proclamation their mike. Don’t be cheep and hire a lawyer. Go back and work on reading comprehension with what I wrote above. Public forums is not a place for legal briefs. I did provide above an entire Legal book reference of law you can purchase to get and read with lots of law and cases and situs etc but I guEss that proclamations. But what do I know I only licensed in 4 states, affiliated with 3 of the top asset protection firms in the nation and selected to super lawyers rising star list plus tip high asset litigator. Who knows. I guess your intervention google law degree knows best.

@Michael Plaks that was answered above. Multiple times. It is not just the costs, which is one benefit, but it offers BETTER protection because of the compartmentalization and separation of the assets into children series. Now if costs and functionality are not important to you as an investor that is fine. The legal protection angle is the separation of assets into individual children companies which a typical LLC does not do, so all your property in the LLC is then subject to a judgment, unless you get a separate LLC for each property which is expensive and the maintenance cost of each LLC is ridiculous.

For liability purposes and protection angle, each child Series is its own LLC! This is ideal for clients with multiple pieces of property or types of assets. John's question was "What is the benefit of a series LLC over a regular LLC other than cost savings" I think asset protection of series is actually inferior to that of a regular LLC."

So to answer his question it is not inferior due to the separation of assets into their own companies for liability purposes. And your question is of the only advantage being the cost has been answers now a few time. The advantage is NOT just costs, that is a byproduct of having just one LLC with the Series LLC, the advantage is the separation of assets in one structure, into children structures, that are treated separately for liability purposes, without having to have multiple separate LLCs and maintenance costs which is an ADDED benefit. You both save on costs, and separate liability of multiple properties all with one company. Not 5. 

@Rob K. on such option of a few is the use of the Delaware Statutory Trust since it is NOT subject to Franchise tax. So for CA investors you would use the DST with the Series LLC. so it is a practical solution for most real estate investors in CA since you would not be paying those franchise tax's. If you were to simply create a Series LLC as a CA resident then yes you are correct. But AP goes farther then that and it is the combination of multiple tools that make it effective and work and going into more detail. Not just boilerplate. It is the COMBINATION of the tools. Not just one tool.

Another method besides mentioned above for CA residents, though very convoluted and many steps is to put those properties into land trusts for privacy of ownership. Then record home-equity lines of credit against them payable to an entity the client was privately. Then  have a third-party entity buy those mortgages and put proceeds into an inaccessible account in their international trust. Then put mortgaged properties into land trust. Then assign the beneficial interest in the land trust to individual LLCs. Then do the equity stripping program mentioned above. Not my most desirable method, but one I learned form the first and most established AP firm in the nation created over 100 years ago and still going strong. 

What is a DST? I am glad you asked. As early as the 16th century, the concept of property being held in trust by one person for the benefit of another was part of the English Common Law. Trust have been around for a very long time. The Delaware Statutory Trust (DST), however, is a statutory entity, created by filing a Certificate of Trust with the Delaware Division of Corporatios and governed by Chapter 38, Part V, Title 12 of the annotated Delaware Code (See 12 §§ 3801 through 3862).Delaware is one of the few states in America to have a statutory trust law. Most states still rely upon common law trusts. This is a HUGE advantage. The Statutory Trust Act, similar to the Delaware LLC law, relies on the legal principle of freedom of contract (See 12 § 3823(b)). The trust agreement is a contract and therefore enforceable. It may create various classes or groups of trustees and/or beneficial owners (See 12 §3806), and it determines the nature of distributions of the trust's assets for the benefit of the beneficial owners (See 12 §3805).There is no Franchise Tax and no Delaware income tax on statutory trusts formed in Delaware. Under the United States' Internal Revenue Code, a business trust may be treated as a grantor trust, a partnership or an association, just as a corporation, depending on the wording of the trust agreement. 

@Rob K. their are ways to work around that with the use of different trusts. 

Stop being google lawyers and doctors and CPAs and actually pay them for advice. Blogs, forums and internet serches create this misconception and then keeps being spread by internet lawyers. You can’t diagnose yourself from a google search. Blogs and forums are general tools for information not finite information and detailed structure. Every single situation will be different for each person. So you really need to not be cheep and not resort to self help and go hire paid specialist in whatever it is as part of your team to give real advice. Not google research and blogs.

@John Hyre you are still off the mark a lot. What is the definition of newish? 28 years of existence and case law is not new. Sorry to burst your bubble. That is well vetted. 4 years of vetting in court and legal system dictates well vetted. 20+ is icing on the cake. 

Those 5 series are all operated under 1 parent company that only has to file one tax form. Having multiple LLCs means tax filings and fees for each LLC which can cost a heck of a lot of money and time vs just one. Series A-e each are separated out under the parent llc so they exist independently of each other, but then tax related you are only filing for 1 parent LLC.

And again, no one LLC does not provide the same protection to all your assets if you are holding all your assets in one LLC that are not separated out since they can all be used to settle one judgment since not separated out in a series LLC. So lets say you have a standard LLC, and you have 4 properties all in that LLC. You get sued for 180k. The first house sold to settle the judgment does not settle the judgment, then they can go to the next, and the next, etc and your car, etc until settled since the properties all all under the LLC. NOW, if you had them in the series llc, all that they can sue under is that one series that the injury or lawsuit happened. The judgment stops at that property. The rest of the properties are safe each in their own independent protected series in their own safe ziplock bag protected.

yes this "plenitude of law" I mention is called  hire a lawyer to do legal research for you and give you a legal memo. Or go to the law library and ask the librarian to point you in the direction of the law books and how to use westlaw and help you do "legal research" for the "plentiful law that exists". Hear is one of MANY legal text book with tons of law you can purchase that is for lawyers "Real Estate Law and Asset Protection" for Texas Real Estate Investors 2018 edition attorney edition. TONS of case law and legal mumbo jumbo that you pay lawyers for. Or you can go hire a lawyer to give you a research memo. And each state NV, DE, WY, etc all have such legal books with case law that "don't exist" and all the case law are on legal research sites lawyers use called westlaw and lexisnexis that don't exist. 

@Michael Plaks you seem to make conclusion statements hidden in the disguise of being a laymen. Just ask the questions without the sarcasm or passive aggressiveness. They are good questions to ask, but your sarcasm distracts from it. 

@Michael Plaks they are actually great holdings companies and superior to the LLC since it allows for separation of assets under one LLC into individualized children companies. All while being under one parent company structure. So if one series gets sued, lets say series A then they cannot go after ALL the assets in the other series b-z, unlike in a standard LLC where all assets are held under one entity and subject to the judgment. seems like a heck a lot more protection. The series LLC was created originally to improve upon the limitations of LLC in the state of Delaware an AP friendly state to compete for business. so should structures not improve? They improved upon a weakness of the standard LLC pertaining to investors. They were created for investors and catered originally to the mutual fund and asset securitization industry. They then went to REI to sort out multiple assets into separate compartments that are isolated and insulated from one another.

Regarding the Series LLC not being tested, that is a misconception. Just not legally true or factual. These have been in existence for more than 20 years created in 1990 and tested in court and withheld court scrutiny over and over again. They have been so successful that at least 13 states now have them and others have different variations of them. Otherwise they would not be in existence anymore and more states would not adding them. It is not the Series LLC's fault that it has not had a judgment against it since the courts upheld them and their structure time and time again its structure and legal status. I guess shame on it for actually working? Is that what you are saying? It works to good?

@Joseph Lucas Jr and @Michael Plaks Regarding states that don't recognize them and just ignoring the status all together the question is a very good one, and the answer is very simple and is established in the backbone and structure of the American Legal System "reciprocity" of other states legal entities. This is very well established in case law in every state and the Supreme Court. Otherwise the system would be destroyed. 

Regarding AZ Family Management Companies, define expensive? Everybody and every firm will charge what they charge and make that determination for themselves. It is not very complex at all to set up and manage, very streamlined. So you seem to just be opining to just type. I don't see where you get complex 

@Joseph Lucas Jr as of now AZ does not recognize the series LLC, so you would have to operate as a foreign entity doing business as in AZ. But it is not very difficult tax wise filing. AZ will eventually have a Series LLC option I think since AZ is competing for Asset Protection business with Nevada, Texas and Delaware. AZ does offer something like the series LLC that we use with L&L called a family limited partnership that acts as a holding company which you then can have similar set up of child LLC set up under it. I do this with Lodmell and Lodmell who really specialize in Bridge Trusts. The AZ Family Limited Partnership is the base level for scalability for clients who then grow into the Bridge Trust. So many options exist. I would say if the goal is AP, the more important thing is the Jurisdiction of where you create your company, not if I have to file one more document. TX, NV and DE are the best. AZ is coming along. If you use the correct structure and clauses. Why a phone call is a lot more informative way to talk options per situations then just quick forum post being taken at face value.

@Joseph Lucas Jr I will IM yu. Short of it you can form one in lets say TX, NV, Delaware, and use them everywhere. You can incorporate a Texas series LLC and use it everywhere you want to invest in.