There are many tools that can be used when making an estate plan. If you want to pass down as much as you can to the beneficiaries without potentially giving them headaches with the IRS or any other financial issues to deal with. One useful tool is the family LLC, and if you’re curious about how it works a Woodland Hills estate tax planning attorney might be able to help you out.
Who Can Form a Family LLC?
Anyone can form an LLC, but as the name suggests only family members can come together and form a family LLC. This gives your family some level of protection and you can continue to control the assets that are put into the LLC.
Depending on the size of your estate and your goals, this could be a beneficial arrangement for you and your family.
What Assets Can Be Put in a Family LLC?
Many different types of assets can be placed in a newly formed LLC. You can transfer valuables like:
- Money from savings and other bank accounts
- Deeds to a property or home
- Cars and other vehicles
- Stocks and securities
Once these are all stored away in your LLC, you maintain complete control over your assets. You can wait to pass them down after you pass away, or you can make some other arrangements without increasing the tax burden your family members will face.
What Are Some of the Advantages of Forming an LLC?
As we alluded to, a family LLC can help reduce your family’s estate tax burden, if your estate is large enough to require state or federal estate taxes to be collected upon your death. When your family gets its benefits through this LLC, they can actually get “shares” of the estate at a discount. This can lower how much would have to be paid out in estate taxes.
You can also hand out assets while you are still alive. There is a normal limit of $17,000 for gifts, per person, per year. When you give away the “shares” of your LLC, you can actually go far beyond this limit because you can give those shares away at a steep discount.
An LLC also offers some legal protections to the people running it. Generally, the assets in an LLC would be protected from creditors and some legal liabilities. Even if a family member gets sued personally, it is unlikely that any asset from their shares of the LLC could be touched.
Talk to an Estate Planning Lawyer Today
A family LLC can be a good fit for anyone who wants to maintain control of their assets as they age and give out some parts of their beneficiary’s inheritance over time. If that sounds like you, contact the Law Offices of Yacoba Ann Feldman and schedule an appointment with our team. We’re ready to help you develop a comprehensive estate plan.