Recent Blog Posts
Professional Limited Liability Company v. Limited Liability Company: What is a PPLC?
What is a Limited Liability Company (LLC)?
We’ve all heard the term LLC before but, do you know what it means and what it does? LLC stands for Limited Liability Company, which is a popular structure used to form a business.
An LLC is essentially a mixture of the best parts of a Partnership business structure (including the tax benefits) and the best parts of a Corporation business structure (including the protection from personal liability).
Partnership Business Structure
There are different types of Partnership business structures. A General Partnership requires no formal formation process, while others simply require a filing with the State. Those that own a Partnership are called Partners. A Partnership business structure offers no personal liability protection in the event that the Partnership or another Partner were to be sued. Simply by the nature of being a Partner in a Partnership, they are subject to liability personally (this includes their own personal assets that have no connection to the business), even if they had nothing to do with the event giving rise to the lawsuit.
Why Living Trusts are for Normal Middle-Class Couples
Trusts are not simply for the ultra-wealthy. Trusts are a great tool for those with modest assets that wish to protect those assets and save unnecessary expenses and arguments between loved ones after their death.
What is a Living Trust and What Does it Do?
A Trust is a fiduciary arrangement that allows a third party (the trustee) to hold title to assets (property) on behalf of certain beneficiaries. The creator of the Trust selects the beneficiaries of the Trust property. As holder of the title, the trustee is subject to the condition of keeping or using the property for the benefit of the beneficiary. A "Living" Trust (sometimes called an "inter vivos" Trust) is a Trust you create while you are alive.
Inter Vivos Trust Attorney in Yorkville and Kendall County
A Trust has a similar function to a will but is often a much better choice for a person looking to control what happens to their property after they pass. The creator of a Trust selects who will be the beneficiaries. Then, those who were selected will receive the Trust property when that person dies. When two people are married, they have the option of setting up a joint Trust.
Estate Planning: Why a Last Will and Testament is NOT your Best Option (and a Living Trust is)
Yorkville and Oswego IL Estate Planning Attorneys
What is a Last Will and Testament?
A Last Will and Testament is a written, legal document that expresses a person’s wishes as to how their property (known as their estate) should be distributed after they pass. A Last Will and Testament also designates a person (known as the Executor) to manage the estate until it is fully distributed. When the creator of the Will dies, the Will must then go through a time-consuming and often costly process called probate court.
What is Probate Court?
Probate is the legal process that a person’s estate must go through when they die either with a Last Will and Testament or when they have no legal estate planning documents stating how they wish their estate to be distributed (this is called intestate). Probate court oversees the transfer of the estate’s property to the deceased person’s heirs, according to state law. When a deceased person does have a Will, the court must first authenticate the Will and then authorize the Executor of the Will to pay any leftover expenses from the estate and then distribute remaining estate property according to the terms of the Will.
What is a Trust And How Does a Trust Work?
What is a Trust?
A Trust is a legal instrument, which holds title to property, subject to certain obligations, rights, and restrictions placed on the property. A Trust is fiduciary relationship in which a party (Trust Maker) establishes a Trust that gives another party (Trustee) the right to manage property that the Trust owns.
What is a Trustee?
A Trustee is a person or entity that is appointed by the Trust Maker (the person or couple that created the Trust) to manage their assets and property. Generally, the Trustee is the same person(s) that creates the Trust for their benefit for estate planning purposes. The Trust instrument or otherwise known as the “Trust Agreement” creates the Trust until they (the creators of the Trust and Trustees of the Trust) are unable to fulfill the role of Trustee. The Trust Agreement will typically pass trust administration to a person(s) or entity upon the Trust Maker’s incapacity or death.
Can You Purchase Property Through an LLC?
A real estate investor asked whether it was acceptable to purchase property through an LLC. The answer is “Yes”. The mortgage will be personally guaranteed by the members of the LLC (or owners of the LLC). The property deed can be titled in the LLC or otherwise known as the Limited Liability Company. Members of an LLC are the owners of the LLC. The owners of a corporation are shareholders. LLC members appoint managers to run the rental property business.
The LLC members pledge their personal assets as collateral to back the lender’s debt. Mortgage companies lend to individual owners of the LLC. The LLC may appear on the title to the rental property. However, the LLC members personally guarantee the mortgage and note.
Benefits of Setting Up an LLC for Real Estate Investors or Landlords?
There are three major benefits of setting up LLCs for rental property. The three benefits are the following:
-
Personal Liability Protection from rental property debts (other than the mortgage and note done by the lender)
Legal Considerations When Selling Or Purchasing a Vacant Lot in Kendall County?
The purchase or sale of a vacant lot contrasts with a normal residential real estate transaction in Kendall County and surrounding areas of Oswego, Yorkville, Plano, Sandwich, and Somonauk. The “Vacant Lot Sales Contract” is the standard real estate contract used for the purchase and sale of a vacant lot.
A vacant lot is a parcel of property or land that has no houses or buildings on it. Many people purchasing a vacant lot have the intention of building a new construction or customized home on the vacant lot. In my experience, most buyers of a vacant lot have the goal of building a new construction property within the next two to three years or earlier. Illegal dumping of waste and litter is a major issue involving vacant lot owners.
SIGN VACANT LOT SALES CONTRACT
The first step in selling a Vacant Lot is the filling out and acceptance of a contract. At Gateville Law Firm, we assist sellers and buyers with the completion of the Vacant Lot Sales Contract. The Vacant Lot Sales Contract involves twenty (20) provisions, which consist of the Vacant Lot Sales Contract.
Why Is Planning for Digital Assets in A Will or Trust Critical?
When we think about what goes in a Will or Trust we usually think about physical assets, such as property and family heirlooms. However, as time goes on and technology advances, more and more of our assets become digital. Before learning why digital assets are so important to put in your Will or Trust, you need to know what qualifies as a digital asset.
What Is a Digital Asset?
Digital assets are all assets that exist online. These digital assets may have tangible financial value, but they also may not. Some examples of digital assets may include:
-
any of your social media accounts,
-
pictures or music you may have online or in another digital form,
-
online investment accounts,
-
online bank accounts,
-
funds you are owed by an online business (such as Amazon or Etsy),
-
any type of virtual currency (bitcoin or other),
Aurora Commercial Real Estate and Business Attorneys
What are the differences between a Limited Liability Partnership and a Limited Liability Company?
This article will discuss the differences between a Limited Liability Partnership and a Limited Liability Company.
Limited Liability Partnership aka LLP
A Limited Liability Partnership or otherwise known as an “LLP” is a business and corporate structure that provides asset protection and growth opportunities. A major reason to establish an LLP is to growth a business and provide a corporate governance structure for the high-growth real estate venture or company. Entrepreneurs and real estate ventures are high-growth, high-risk ventures, which require the expertise of lawyers and accountants.
General Partner vs. Limited Partner
An LLP is comprised of a general partner and limited partners. A general partner is the key entrepreneur or enterprise, which spearheads a commercial enterprise of limited partners. A limited partner is a business owner that acts an investor or key employee of a business. The benefit of the limited partner is they own a share of the commercial enterprise without the control and voting share of the general partner. A major benefit of a limited partner is limited liability protection. Essentially, a limited partner has much greater liability and asset protection than a general partner.
1031 Exchange Benefits: Protecting Real Estate Investor’s Gains From the IRS During the Sale of Property
In 2021, the median value of a home in the state of Illinois increased almost 50% from the median value in 2012. 10 years ago the median home value in Illinois was $157,000. In 2021 Zillow reported that number to be just under $230,000. Now, in 2022, that number has grown over 11% in just one year to over $267,000. The increasing home value is great news for real estate investors and owners of investment properties. However, the IRS (Internal Revenue Service) can and will go after a seller’s gains through taxes. A 1031 Exchange is one way that investors in real estate can avoid certain taxes by the IRS.
What is a 1031 Exchange?
A 1031 Exchange is a tool that real estate investors and owners of investment properties can use to protect their gains from the sale of property from being taxed by the IRS.
26 U.S. Code §1031(a)(1) states: no gain or loss is recognized if property held for productive use in a trade or business or for investment is exchanged solely for property of a “like-kind” which is to be held either for productive use in a trade or business or for investment.
Limited Liability Company (“LLCS”): The ins and Outs of LLCs
A Limited Liability Company is a hybrid between a Corporation and a Partnership. A Partnership is when two or more people join together to establish a business. The benefit of a partnership is the flexibility of business arrangements. A partnership can be any written benefit that two or more people envision. The drawback to a partnership is the lack of limited liability protection. The benefit of a corporation is the separation between a person’s assets and business liabilities. A Corporation provides limited liability protection for their owners or otherwise known as “shareholders.”
1. Limited Personal Liability
In this article, we will examine the benefits of LLCs. The first major benefit that we will discuss is limited liability protection. Prior to incorporating a business, many entrepreneurs are sole proprietorships or partnerships. Generally, establishing an LLC is a sign of maturity in business. Limited personal liability is the benefit of limiting the business liabilities to the business (or LLC). An LLC creates a separate legal entity, which is distinct from its’ owners. As a separate legal entity, the business owners and its’ personal liabilities are distinct from the business.
Questions?
Contact Us Today
Call 630-780-1034 or fill out the form below to set up a free consultation today:
The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.
I have read and understand the Disclaimer and Privacy Policy.
Results listed are not a guarantee or indication of future case results.
201 East Veterans Parkway, Suite 14,
Yorkville, IL 60560
630-780-1034
