All Forum Posts by: Shafi Noss
Shafi Noss has started 96 posts and replied 543 times.
Post: Many Times I Said Don't Waste Your Money on LLC Vesting. Now this:
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@Christie Gahan Yes, what @David M. said. You're just giving up your ability to choose.
Post: Many Times I Said Don't Waste Your Money on LLC Vesting. Now this:
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"If the property is held in a partnership the assets in the partnership do not automatically receive a step-up in basis like those held in a disregarded LLC."
"A failure to make a 754 election will result in the basis not getting a step-up."
Source: https://hmbtx.com/blog/step-up-in-basis-for-assets-held-in-a...
Does this source and conclusion look legitimate to you?
If so, then if the decedent didn't set up the LLC correctly, which happens all the time, gifting LLC interest could be very harmful.
Post: Loss of Rent Insurance when property is vacant??
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The fact that there was no tenant in the property muddies the water. I think in this case best thing to do is look at the language in your policy. Hopefully your normal insurance recovers the water damage though!
Post: Many Times I Said Don't Waste Your Money on LLC Vesting. Now this:
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Quote from @Mike S.:
Quote from @Shafi Noss:
Or if you are trying to pass on property to heirs and you give them LLC shares, they lose the stepped-up basis if you would have just given it to them normally otherwise.
Where do you get that from?
First, LLC don't have shares, they have membership interest.
Second, your heirs get the step up basis at the time of your death, you just need to have proper documentation or appraisal to show the current value of your LLC at that time.
Third, even with shares of corporation you get the step up basis (like your brokerage account).
But anything transferred before your death, LLC or not does not get step up basis.
You own an LLC containing property and gift $10k of LLC interest to your daughter through the uniform gifts to minors act. You also have $10k cash. Then you die. Your daughter will not get a step up on the remaining LLC shares.
On the other hand if you own property but with no LLC and gift $10k cash to your daughter through the act and then die, the daughter will get a step up basis.
Many exceptions and talk to your CPA, etc.
If this is true, using an LLC really screwed you into some taxes. Before I run around for sources, do you think this scenario is impossible?
Post: Many Times I Said Don't Waste Your Money on LLC Vesting. Now this:
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Or if you are trying to pass on property to heirs and you give them LLC shares, they lose the stepped-up basis if you would have just given it to them normally otherwise.
Post: Many Times I Said Don't Waste Your Money on LLC Vesting. Now this:
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Quote from @Caroline Gerardo:
Furniture for Sale From Luxury LLC Corp. $1.
Sorry to tell all the cottage industry attorneys and gurus on BP that owning or vesting in a LLC no longer keeps your identity secret. It really never did. If you applied for a mortgage with the LLC it's publicly registered. And everything digital can be accessed or hacked.
Beneficial ownership reporting is a requirement from the Financial Crimes Enforcement Network (FinCEN). This is the U.S. government's efforts to prevent money laundering, financing of terrorism, tax fraud, and other illegal acts. Beneficial ownership reporting requires those with control over businesses or legal entities to provide identifying information.
This information includes: Full legal name, Date Of Birth, Residential Address, Unique identifying number from a non-expired US passport, state identification document or driver's license, social security number, ITIN number, or foreign passport.
Reporting companies must file their initial reports electronically through FinCEN's Beneficial Ownership Secure System (BOSS). Reporting companies created or registered to do business in the United States before January 1, 2024 must file by January 1, 2025. A beneficial owner is a person who enjoys the benefits of ownership even though the title to some form of property is in another name.
A court can subpoena the name, address, DOB, driver's license/passport or ITIN or Social security number thus exposing your asset protection plan.
Twenty three types of entities are exempt from the beneficial ownership information reporting requirements.
These entities include:
- Publicly traded companies meeting specified requirements- you know those on the stock market
- Many nonprofits but not all- the not for profit has to be approved, filed, and registered with IRS and the state.
- Certain large operating companies
Other entities that are exempt from BOI reporting include:
- Sole proprietorships
- Unincorporated associations such as HOA's
- Estates
- Family trusts includes Revocable Living Trusts
- Natural persons opening accounts on their own behalf a human who uses their real name
- Trusts (other than statutory trusts created by a filing with the Secretary of State or similar office)
- Authorized users for credit cards, your children on your VISA card
- I wrote 50 times to vest in Living Trusts and save the filing costs, keeping money separate, and paying for extra tax returns and attorney fees. Now here is another piece of evidence why not to bother with Asset Protection Schemes.
- Caroline Gerardo
- NMLS 324982
- opinions are my own
Post: Owner’s title insurance - to get or not?
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@Bob Floss II That's a good point about the unreported payouts.
Do you know if there are statistics on losses sustained by owners that don't buy policies? I wouldn't be surprised if not but that compared with the paid claims + losses of owners who do buy title insurance would be a good indicator of how much risk is being removed per dollar spent.
Post: Owner’s title insurance - to get or not?
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@Peter Walther Yes I did not know that thanks for explaining.
But doesn't it seem like a bad system to not record an easement on the servient deed / a separate easement agreement searchable in public records? If only recorded on the dominant deed it just creates the potential for confusions like this with no upside.
Maybe there's something I'm missing about the inclusion? I'm not sure what the difference is between conveying the back half through inclusion and just selling it like normal if there are only 2 parcels. Using this definition or did you mean something else: https://legal-lingo.com/inclusive-grant
Post: Owner’s title insurance - to get or not?
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Maybe the necessity easement would be granted on a different piece of land than the front 5 acres
Post: Owner’s title insurance - to get or not?
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@Peter Walther I thought easements were recorded on both the dominant and servient property deeds, or maybe sometimes separately in county records, why would it not be recorded on the servient property, seems like that's the one place it should be recorded if anywhere. Otherwise I could sell a property to you and just write in that you have an easement over one of Jay's parcels without his permission?
Also after that back and forth, how could there be a landlocked property that wouldn't be granted an easement by necessity?