Using online services in conjunction with your business

[Sylvia Castellanos]

I would like the thoughts of people on this forum who have more experience than what I have.

Let me set up my question. I own two properties for which I wanted privacy. I looked up online companies that provide the service of setting up llcs and s corps, and I finally picked Wyoming LLC Lawyer. I had it set up a holding company in Wyoming, then an llc in PA that was a subsidiary of the holding company. The idea is for me to transfer the two properties from my personal name to the subsiadiary llc, which is under the holding company.

For what seemed like very reasonable payment Wyoming LLC Lawyer set up these two entities and provided me with articles of incorporation. For a small monthly fee it gives me a mailing address to use and a registered agent. This agent take s care of doing the filings with the government that are needed in the course of the year. I was assuming that they would give me the name and phone number of the agent so I could coordinate with him. The agent turned out to be not a person but an entity named Sage Agents. When I asked them, they said this was a division of Wyoming LLC Lawyer. The phone number they gave me to give out as being my office number is just their customer service number.

Then I saw how limited the service was. When I prepared the deed to transfer the properties to the llc, there was one place for the grantee to sign. I called Wyoming LLC Lawyer and said I needed to coordinate for the agent to sign. To my surprise, she said they signed only documents that they created, like the various reports to the government. They flatly refused to sign anything I might send them. So I was going to have to sign the document, although the whole point was to leave my name out of it.

On the one hand, I am new to managing an llc, so having an organization let me know what documents I need to file and what should go on them is very valuable. On the other hand, my experience got me thinking that many situations can arise where if I have a registered agent I will need to confer with him, and even have him sign things. I am beginning to see that the service Wyoming LLC Lawyer is providing is going to be very inadequate.

So this sets up my question. I am wondering if people have experience with other online companies that offer a more comprehensive service. Going beyond that, what options exist for such a service outside the category of online services, although perhaps they cost more. I would like the input of my more experienced colleagues.

[Jeff S.]

Are you an underworld figure, @Sylvia Castellanos? In witness protection? Perhaps a CIA operative? These seem to be some extraordinary and expensive steps you’re going through to obtain something virtually no one needs. Honestly, I had to smile over the irony.

I’m not trying to be snarky but you’re jumping through hoops to secure anonymity, only to end up frustrated by the very companies that promise it—companies that, ironically, are shrouded in their own layers of privacy. If you're already this annoyed trying to work with them, imagine how anyone else will feel trying to do business with you.

Here's the simple truth: despite the glossy promises made by the law firms pushing this stuff, real, airtight privacy just doesn't exist. Try sending one of your attorneys into court to tell a judge, "Sorry, we're not disclosing who owns the LLC." How do you think that will work out?

Also worth noting—unless all your properties are located in Wyoming, your LLCs will have to register as foreign entities in every other state where the properties actually sit. That usually means disclosing ownership anyway—and paying for the extra fees and tax reporting.

I know many investors who are perfectly comfortable buying property in their own name. Most, however, form LLCs in the states where the properties are located, run their businesses with integrity (not implying you don’t), and carry adequate insurance.

Bottom line: in this day and age, there’s virtually no privacy that can’t be pierced. And anyone telling you the opposite is probably selling you something else, too. Don’t waste your time or money on this.