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<p class="MsoNormal">I agree with both you and Elizabeth. I just hate having to argue with the IRS over these things with so much money at stake. I have encountered far more foolish arguments from auditors in the past and pointing out their errors of logic
is expensive and risky. I once had an auditor claim that an exchange was blown because the Qualified Intermediary did not rent out the property and only held the funds so therefore the relinquished property was not qualified. That one made it all the way
to appeal before I could convince them their argument was nonsense. <o:p></o:p></p>
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<p class="MsoNormal"><b>From:</b> wsbarp-bounces@lists.wsbarppt.com <wsbarp-bounces@lists.wsbarppt.com>
<b>On Behalf Of </b>Eric Nelsen<br>
<b>Sent:</b> Tuesday, May 3, 2022 4:40 PM<br>
<b>To:</b> WSBA Real Property Listserv <wsbarp@lists.wsbarppt.com><br>
<b>Subject:</b> Re: [WSBARP] Showing my ignorance ( again)<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Craig—For what it’s worth, I would argue that putting wrong information on
<i>a report made to Secretary of State</i> is just wrong information on a report. In order to
<i>actually</i> add someone as a member, something further must be done—vote of the members or whatever the operating agreement requires. See
<a href="https://app.leg.wa.gov/RCW/default.aspx?cite=25.15.116">RCW 25.15.116</a> on admission of members.
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">So I think the remedy is to amend the report to make it accurate; and the fact the report named the wrong people as governors should not have an impact on a 1031 exchange.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">That said, an annual report might be a “record” of the LLC such that adding someone to the report actually does add them as a member. But it’s not an automatic consequence; I think there might be arguments against that depending on how
the LLC is managed.<o:p></o:p></p>
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<p class="MsoNormal">Sincerely,<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Eric<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Eric C. Nelsen<o:p></o:p></p>
<p class="MsoNormal">Sayre Law Offices, PLLC<o:p></o:p></p>
<p class="MsoNormal">1417 31st Ave South<o:p></o:p></p>
<p class="MsoNormal">Seattle WA 98144-3909<o:p></o:p></p>
<p class="MsoNormal">206-625-0092<o:p></o:p></p>
<p class="MsoNormal"><a href="mailto:eric@sayrelawoffices.com"><span style="color:#0563C1">eric@sayrelawoffices.com</span></a><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><b><span style="background:aqua;mso-highlight:aqua">Covid-19 Update -
</span></b>All attorneys are working remotely during regular business hours and are available via email and by phone. Videoconferencing also is available. Signing of estate planning documents can be completed and will be handled on a case-by-case basis. Please
direct mail and deliveries to the Seattle office.<o:p></o:p></p>
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<p class="MsoNormal"><b>From:</b> <a href="mailto:wsbarp-bounces@lists.wsbarppt.com">
wsbarp-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbarp-bounces@lists.wsbarppt.com">wsbarp-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Craig Gourley<br>
<b>Sent:</b> Tuesday, May 3, 2022 4:24 PM<br>
<b>To:</b> WSBA Real Property Listserv <<a href="mailto:wsbarp@lists.wsbarppt.com">wsbarp@lists.wsbarppt.com</a>><br>
<b>Subject:</b> Re: [WSBARP] Showing my ignorance ( again)<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Thank you. Based on that definition I see an opportunity for disaster. People add “Governors” without understanding the consequence. In a typical Member Managed LLC , adding a Governor is defined as adding a Member. This results in
elimination of the Disregarded Entity status for federal tax purposes, requires filing of a Partnership Tax return and in my fact pattern probably blows a 1031 exchange resulting in several hundred thousand in federal tax liability. Law of unintended consequences.
<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><b>From:</b> <a href="mailto:wsbarp-bounces@lists.wsbarppt.com">
wsbarp-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbarp-bounces@lists.wsbarppt.com">wsbarp-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>David Daniel<br>
<b>Sent:</b> Tuesday, May 3, 2022 3:04 PM<br>
<b>To:</b> WSBA Real Property Listserv <<a href="mailto:wsbarp@lists.wsbarppt.com">wsbarp@lists.wsbarppt.com</a>><br>
<b>Subject:</b> Re: [WSBARP] Showing my ignorance ( again)<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Verdana",sans-serif;color:#073763">I believe the term is defined in this context at RCW 23.95.105(12).<o:p></o:p></span></p>
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<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="color:#222222"><o:p> </o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto;background-image:initial;background-position:initial;background-repeat:initial">
<b><span style="font-family:"Garamond",serif;color:#073763">David C. Daniel</span></b><span style="font-family:"Garamond",serif;color:#073763">, Attorney</span><span style="color:#222222"><o:p></o:p></span></p>
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<u><sup><span style="font-family:"Garamond",serif;color:#073763">____________________________________</span></sup></u><span style="font-family:"Garamond",serif;color:#073763"><br>
</span><b><span style="font-size:13.5pt;font-family:"Garamond",serif;color:#073763"> DEMCO LAW FIRM, P.S.</span></b><span style="font-family:"Garamond",serif;color:#073763"><br>
<u><sup>____________________________________</sup><br>
</u></span><b><span style="font-size:13.5pt;font-family:"Garamond",serif;color:#073763">Phone|</span></b><span style="font-size:13.5pt;font-family:"Garamond",serif;color:#073763"> (206) 203-6000</span><span style="font-family:"Garamond",serif;color:#073763"><br>
<b>Email |</b> </span><u><span style="font-family:"Garamond",serif;color:#1155CC"><a href="mailto:ddaniel@demcolaw.com" target="_blank"><span style="color:#1155CC">ddaniel@demcolaw.com</span></a></span></u><span style="color:#222222"><o:p></o:p></span></p>
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<span style="font-family:"Garamond",serif;color:#073763">5224 Wilson Ave S #200</span><span style="color:#073763"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-family:"Garamond",serif;color:#073763">Seattle, WA 98118</span><span style="color:#222222"><o:p></o:p></span></p>
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<p class="MsoNormal">On Tue, May 3, 2022 at 2:56 PM Craig Gourley <<a href="mailto:craig@glgmail.com">craig@glgmail.com</a>> wrote:<o:p></o:p></p>
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<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto">Listmates. So what exactly is a “ Governor” when it comes to the Secretary of State and LLCs . I can not find a definition anywhere. I currently have people listed as “Governors”
telling me that they are not “Members” and not Managers ( Member Managed LLC). They claim to have no financial interest but are listed as Governors by the Secretary of State. I realize that the SOS did not randomly do this and in this case I know they
were added by a family member. Is there any legal ramification to being made a “Governor” or can one randomly add anyone I feel like?
<o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"> <o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"> <o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"> <o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><b><span style="font-size:14.0pt">B. Craig Gourley</span></b><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><b><span style="font-size:14.0pt">Gourley Law Group</span></b><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><b><span style="font-size:12.0pt">Snohomish Escrow</span></b><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><b><span style="font-size:12.0pt">The Exchange Connection</span></b><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><b><span style="font-size:14.0pt"> </span></b><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:10.0pt;font-family:"Arial Rounded MT Bold",sans-serif">1002 10<sup>th</sup> Street / PO Box 1091</span><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:10.0pt;font-family:"Arial Rounded MT Bold",sans-serif">Snohomish, WA 98291</span><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:10.0pt;font-family:"Arial Rounded MT Bold",sans-serif"> </span><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:10.0pt;font-family:"Arial Rounded MT Bold",sans-serif">360.568.5065</span><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:10.0pt;font-family:"Arial Rounded MT Bold",sans-serif">360.568.8092 fax</span><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><u><span style="font-size:10.0pt;font-family:"Arial Rounded MT Bold",sans-serif;color:#0563C1"><a href="mailto:Craig@glgmail.com" target="_blank"><span style="color:#0563C1">Craig@glgmail.com</span></a></span></u><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"> </span><o:p></o:p></p>
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<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:9.0pt;font-family:"Arial",sans-serif;color:red">Be Aware! Online banking fraud is on the rise. If you receive an email containing
<b>Wire transfer instructions </b>call us immediately to verify the information prior to sending any funds!</span><o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"> <o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:8.0pt;font-family:"Arial",sans-serif;color:blue">CONFIDENTIALITY NOTICE: This electronic mail transmission may contain legally privileged, confidential information
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