[WSBAPT] Assignment of LLC to Revocable Living Trust

John J. Sullivan sullaw at comcast.net
Thu Apr 6 09:58:07 PDT 2017 

Yes. And post-Morten too. 

The RLT is a legal entity, in the person of the trustee. No state registration and generally a disregarded entity for IRS purposes. It becomes a separate entity for tax at death when it becomes irrevocable. 

Assign the Member Units of the LLC to the trustee in writing. They are just another asset of the trust estate. 

John J. Sullivan

Sent from my iPhone

> On Apr 6, 2017, at 9:24 AM, MK Henderson <law.mkh at gmail.com> wrote:
> 
> Does this work the same way for a c-corp? I have researched this briefly and that is my understanding.  The RLT would be used for probate avoidance by holding the C-Corp but the C-corp operates as its own business entity during single member owners lifetime?
> 
>> On Tue, Mar 21, 2017 at 3:52 PM, Teunis J. Wyers <teunisj at wyerslawpc.com> wrote:
>> This all makes sense, except the part about a RLT being an entity with its own life.  A RLT is not an entity. It is not subject to Secretary of State business registration rules.  A RLT agreement provides that the trustee(s) will hold, and own, specified assets in trust for specified purposes.  It is not proper or legally adequate to convey property to a trust; you convey to the trustee(s).
>> 
>>> On Tue, Mar 21, 2017 at 11:23 AM, Mike Winslow <mike at winslegal.com> wrote:
>>> You might benefit from diagraming this out, with some boxes or compartments to better illustrate what is happening. Keep in mind you have two separate entities, each with specific assets. Revocable Living Trust (RLT) and the LLC.
>>> 
>>> Here is how it looks:
>>> 
>>>  
>>> 
>>> The RLT is your probate avoidance device. The RLT is an “entity”, with its own life.
>>> 
>>> The RLT owns the units in the Property LLC, not the property itself.
>>> 
>>> The units in the LLC belong to the RLT by virtue of the transfer of the units under the assignment you describe.
>>> 
>>>  
>>> 
>>> The LLC is an entity separate from the RLT.
>>> 
>>> The LLC owns the property by virtue of the QCD to the LLC. That deed lists the record owner as the LLC, not the RLT.
>>> 
>>>  
>>> 
>>> At death of the Trustors under the RLT, the successor trustee may transfer the units in the LLC to the residuary beneficiaries of the RLT. No probate required to accomplish that act.
>>> 
>>> Once the residuary beneficiaries own the units in the LLC, they control the LLC and may do as the please (subject to applicable tax laws) with the property. The new unit owners may transfer the property out of the LLC by deed from the LLC to the beneficiaries, although they may be benefit to leaving the property in the LLC if they intend to continue to own and manage the property.
>>> 
>>>  
>>> 
>>> Michael A. Winslow
>>> 
>>> 1204 Cleveland Ave.
>>> 
>>> Mount Vernon, WA 98273
>>> 
>>> Ph. 360-336-3321
>>> 
>>> Em. Mike at winslegal.com
>>> 
>>>  
>>> 
>>> This message is from an attorney, so it’s confidential. If you are not the intended recipient, it’s too late to stop reading this message, but you may not use it for any improper purpose. Huge Disclaimer available upon request.
>>> 
>>>  
>>> 
>>> From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Margaret Delp
>>> Sent: Monday, March 20, 2017 3:23 PM
>>> To: WSBAPT at lists.wsbarppt.com
>>> Subject: [WSBAPT] Assignment of LLC to Revocable Living Trust
>>> 
>>>  
>>> 
>>> Husband and Wife  have  transferred their real property via quit claim deed to an LLC.  Husband and Wife are the only owners of LLC.  Husband and Wife have also signed a Revocable Living Trust.  They have also signed an “LLC Membership Assignment” assigning their interest in the LLC to the Trustee of the Revocable Living Trust.  (Multiply above by 4 properties, and four different LLCs).
>>> 
>>>  
>>> 
>>> QUESTION:  Upon death of the surviving spouse, can the successor trustee of the Revocable Living Trust simply execute a deed transferring title to the LLC’s real property to the beneficiaries identified in the distribution provisions in the Revocable Living Trust without opening a probate?  Would they need to record the LLC Membership Assignment and a Certification of Trust with the County  along with the deeds at the time of distribution of the properties?    
>>> 
>>>  
>>> 
>>> Thanks much,
>>> Margaret
>>> 
>>>  
>>> 
>>>  
>>> 
>>>  
>>> 
>>> --
>>> 
>>> Law Office of Margaret Delp
>>> 
>>> Mailing address:
>>> 
>>> PO Box 292
>>> 
>>> Langley, WA 98260
>>> 
>>> Physical Address:
>>> 
>>> 2815 Howard Road, Second Floor
>>> 
>>> Langley, WA 98260
>>> 
>>> Telephone: 360-579-4530
>>> 
>>>  
>>> 
>>> 
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>> 
>> 
>> 
>> -- 
>> Teunis J. Wyers @ Wyers|Wyers, Attorneys
>> Oregon Office:
>>      216 Columbia St. - P.O. Box 917
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>> Washington Office:
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>> Email:  teunisj at wyerslawpc.com
>> Web:  www.wyerslawpc.com
>> 
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>> 
>>  
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> 
> 
> 
> -- 
> Mary K. Henderson
> Henderson Law Office PLLC
> 1123 Maple Ave SW, Suite 225
> Renton, WA 98057
> 206-650-2472
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