Does an LLC really help?

[Alex Potec]

First a quote:

I found this in a tax adviser's blog. This is not a unique opinion. Every often I see people talking of LLC not being a real protection.
Now my question: Have any of you seasoned investors been in a situation when you needed such a protection and having an LLC (or another incorporation form) insulation really helped? If yes, could you share the story?

[Matthew Gil]

The tax advisor is half right.

If all an investor does is whip a property into an LLC, then an attorney could pierce the corporate veil and go after the investors.

On the other hand, if the partners in the LLC have a strong operating agreement, keep minutes and don't mingle personal funds with the LLC's funds, then an attorney or court is going to be hard pressed to go after the partner's assets.

The moral of the story, run your real estate investment LLC as professional business.