All consultations can be conducted in-person, via video conference or teleconference
Lucas Real Estate – with attorney Devin R. Lucas and CPA Courtney R. Lucas – offer unique expertise in LLC formation and maintenance for real estate holdings.
Contact our office or book an appointment now if ready to proceed with a detailed discussion about your LLC goals including privacy and tax considerations of a California LLC.
Forming an LLC (a Limited Liability Company) to hold real estate has long been a common approach for estate planning, tax, liability protection and privacy concerns. Liability protection and privacy are the two most common goals we address. While this practice is perfectly legal in California and elsewhere, there are some important considerations and tax implications to review and understand prior to forming your LLC. You should meet with an attorney and/or tax professional to discuss.
An LLC alone will not accomplish any of your goals if not formed and maintained properly. For example, the “privacy” aspect only works if your name does not appear on the LLC public records; thus involvement of a third-party (family, attorney, etc.) is often required to ensure complete privacy; Likewise, liability protections will fail if you do not use and maintain the LLC correctly (i.e. leases, payments, etc., all coming and going from the LLC). If you have a loan on the property, transfer of the property into an LLC may violate your “due on sale” clause.
High-end properties, especially those purchased in all-cash transactions, such as many homes in Newport Beach, Laguna Beach and Coastal Orange County, are frequently purchased and held in LLCs.
Regardless if your portfolio consist of large commercial properties, or a single rental condo, an LLC may be right for you.
REVIEW THIS ARTICLE ON REAL ESTATE LLCs FOR ADDITIONAL INFORMATION:
(LINK TO LLC ARTICLE)
COSTS AND TIMELINE TO FORM AN LLC:
Contact our office to discuss your LLC needs, or book an appointment now if ready to proceed.
All LLC formations are handled with an initial consultation ($295) to fully discuss the requirements, tax, liability, privacy, etc. and ultimately determine if an LLC is right for you. (We have met with many clients that ultimately decide not to utilize an LLC). From there, one-party LLCs can be easy, including filing of the Articles of Organization, drafting a basic Operating Agreement, and filing of the initial Statement of Information, along with advice and guidance throughout the formation, generally for $500, plus state expenses, see below. More complicated LLCs (such as multiple owners, potential joint venture agreements included, etc.) and/or actual deed filings (transferring properties into or out of an LLC) can also be done on a flat-fee basis, unique to the tasks. Mr. Lucas will provide proposed fees following the initial meeting and clarification of everything involved.
Additionally, the State of California has its own fees (i.e. a $70 initial filing (one time), $20 for the “Statement of Information” (filed bi-annually) and $800 minimum annual tax to the California Franchise Tax Board (more info on fees and taxes here via CAFTB)
If you are transferring a property into an LLC, additional County filing fees likely apply (unique to each county; check with your county recorder’s office or contact our office).
there, one-party LLCs can be as little as $400 including filing of the Articles of Organization, drafting a basic Operating Agreement, and filing of the initial Statement of Information, along with advice and guidance throughout the formation. More complicated LLCs (such as multiple owners, potential joint venture agreements included, etc.) and/or actual deed filings (transferring properties into or out of an LLC) can also be done on a flat-fee basis, unique to the tasks. Mr. Lucas will provide proposed fees following the initial meeting and clarification of everything involved.
Timeline: An LLC generally takes 7-14+ days to form with the California Secretary of State once the documents are completed, signed and filed. This is the regular processing timeframe and is subject to delays if the Secretary of State’s office is busy.
From the initial consultation, our office generally requests 48-hours to draft the documents (though earlier requests can be accommodated) for your review. Once approved, we file for your LLC; then the State’s timeline takes over.
Thus, a regular LLC filing generally takes 9-16+ days from the date of the initial consultation.
For an additional “rush fee” (to the state, not our office), of $350 – $750, you can have an LLC formed within 24-hours ($350) or instantly ($750). This process however requires someone physically going to Sacramento to file. Our office uses experienced attorney service providers to achieve this goal, generally around $100 additional fee to that third-party. Any rush fees are passed-through to the client with no up-charge.
Contact our office to discuss your LLC needs, or book an appointment now if ready to proceed.
info@lucas-real-estate.com
949-478-1623
