Great videos! I own 6 rental properties and am weighing possible asset protection strategies. Rather than a Series LLC or individual LLC's, how about just increasing general liability insurance to $1-2 million for each house and getting a $2-3 million umbrella policy that covers all 6? Seems as though that would cover you sufficiently. Perhaps then also put all 6 into 1 LLC in case doomsday scenario occurred and I was sued for more than the insurance covers. Would potentially lose the properties, but they couldn't get to my personal assets bc of the LLC. Does that sound like a good plan?
The problem is you would need to make sure the policy will cover almost every inch of things that goes wrong and most insurance policies may not even cover things like mold, etc, which puts your assets at risk. Having them either in a series or in multiple llc will provide greater asset protection so if the insurance fails to cover the claim and you dont have the money to cover any possible settlement, all other assets wont be at risk of being seized by the creditor.
The cell LLCs need to be maintained as financially separate entities. In theory, you can do this through bookkeeping, but it looks a lot better for them to each have their own financial structures.
It isn’t the same thing as a holding company and subsidiaries, but you could use that as an analogy. Supposedly each cell LLC (baby LLC) is independent, where as a subsidiary is dependent upon the holding company.
Thank you 😊 "mommy and baby LLC's" cute.
You’re welcome 😊
Mr. Phillips you are my sensei....
great video very helpful
Can't wait for Florida to use this structure.
Great videos! I own 6 rental properties and am weighing possible asset protection strategies. Rather than a Series LLC or individual LLC's, how about just increasing general liability insurance to $1-2 million for each house and getting a $2-3 million umbrella policy that covers all 6? Seems as though that would cover you sufficiently. Perhaps then also put all 6 into 1 LLC in case doomsday scenario occurred and I was sued for more than the insurance covers. Would potentially lose the properties, but they couldn't get to my personal assets bc of the LLC. Does that sound like a good plan?
The problem is you would need to make sure the policy will cover almost every inch of things that goes wrong and most insurance policies may not even cover things like mold, etc, which puts your assets at risk. Having them either in a series or in multiple llc will provide greater asset protection so if the insurance fails to cover the claim and you dont have the money to cover any possible settlement, all other assets wont be at risk of being seized by the creditor.
I have a property in each cell of me series LLC, but only my main LLC has a checking account. Is that ok?
The cell LLCs need to be maintained as financially separate entities. In theory, you can do this through bookkeeping, but it looks a lot better for them to each have their own financial structures.
LegaLees How would one go about getting an EIN for each one? Would I have to make them all an LLC?
Is this the same thing as a holding company with subsidiaries?
It isn’t the same thing as a holding company and subsidiaries, but you could use that as an analogy. Supposedly each cell LLC (baby LLC) is independent, where as a subsidiary is dependent upon the holding company.