The Biggest Mistakes In Asset Protection Planning For Investment Real Estate

by Bruce Givner on January 2, 2012

You have worked for years to accumulate your investment real estate, whether condos, single family residences, apartment buildings, office buildings or shopping centers. Now you are being sued and the valuable equity is at risk. What are the mistakes you made that have exposed that valuable equity to loss to a judgment creditor?

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  • You own the real property in your own name.
  • Your “living trust” owns the real property.
  • A single member California LLC owns the real property and you are the single member.
  • A Nevada single member LLC owns the real property and you are going into bankruptcy.
  • A Nevada (or other state with favorable domestic asset protection trust law) owns the real property, you are going into bankruptcy and it has been less than 10 years since you transferred the property into the trust. Read: In re Mortensen.
  • A corporation owns the real property and you are the sole shareholder.
  • Your children’s trust owns the real property and (i) you are the trustee; (ii) you have not kept good books and records; and (iii) the trust has been paying your personal expenses.  In re SchwartzkopfIn re Yerushalmi.
  • A 50 – 50 general partnership owns the real property and the partners are you and any other person.

In future blogs we’ll discuss the preferred ways to hold investment real property, to minimize the exposure to a future creditor.

Find out what Givner & Kaye can do for you. Contact us today. (310) 207-8008

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