[WSBARP] [WSBAPT] In active LLC - transfer of real property to living trust

Fri Oct 30 09:22:46 PDT 2026

*Bankruptcy perspective:*  Revocable Living Trusts are great; but the
homestead in this state only applies to property owned by the debtor that
the debtor lives in, intends to live in, or has dependents living in.  And,
assets in a revocable trust are accessible by trustor’s creditors.

While a good argument can be made that the beneficiary of a trust living in
a property that is in the trust, should be able to claim that homestead, it
is not explicit in the code nor is there any good case law that I am aware
of in this state.

Reminder, in King County, the homestead exemption this year is $940,000.

I recommend to my clients that they move the homestead out of the trust
before filing.  There is another gotchya though. The 1,215-day rule, which
is a federal statutory cap under 11 U.S.C. § 522(p) of the U.S. Bankruptcy
Code.  This is how long if a client wanted to be uber safe would wait after
that transfer to file the bankruptcy.

Again, there are good equitable beneficial title arguments to be made, but
what one bankruptcy judge may buy, another may not.

*Mark C. McClure* *| *
*Managing Attorney *Law Office of Mark McClure, PS

*"Why Retire With Debt?"*1103 West Meeker Street, #101
Kent, WA 98032

Office:  253.631.6484 (Leave Msg - Will be returned within 24 hours)
Email: Mark at McClureLawGroup.com
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*From:* wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com>
*On Behalf Of *Eric Nelsen
*Sent:* Friday, October 30, 2026 9:12 AM
*To:* WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>; 'WSBA Real
Property Listserv' <wsbarp at lists.wsbarppt.com>
*Subject:* Re: [WSBAPT] In active LLC - transfer of real property to living
trust

The transfer should be done by the persons authorized to dissolve and wind
up the LLC. If it’s member-managed, then a deed from all members would
probably do it—but need to read the LLC’s Operating Agreement and the
statutes. See RCW 25.15.297.

Sincerely,

Eric

Eric C. Nelsen

Sayre Law Offices, PLLC

1417 31st Ave South

Seattle WA 98144-3909

206-625-0092

eric at sayrelawoffices.com

*From:* wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com>
*On Behalf Of *Jeff at bellanddavispllc.com
*Sent:* Friday, October 30, 2026 9:04 AM
*To:* 'WSBA Real Property Listserv' <wsbarp at lists.wsbarppt.com>; 'WSBA
Probate & Trust Listserv' <wsbapt at lists.wsbarppt.com>
*Subject:* [WSBAPT] In active LLC - transfer of real property to living
trust

Listmates:

For estate planning purposes, PC and siblings transferred rental real
property into an LLC.  After covid and the new landlord-tenant act, the
property was taken out of the rental pool and one sibling bought out.  The
other siblings let the LLC license lapse.  Now the remaining members want
to transfer the property to a Trust.  Can the remaining members sign a deed
on behalf of the LLC and transfer insurable title to a newly formed trust?

Jeff Davis

*W. Jeff Davis*

*BELL & DAVIS PLLC*

*Attorneys at Law*
P.O. Box 510

720 E. Washington Street, Suite 105
Sequim WA 98382
Phone: (360) 683.1129
Fax: (360) 683.1258
email: jeff at bellanddavispllc.com
www.bellanddavispllc.com

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