Land Trust and LLC Asset Protection

[Lucas Carroll]

Hi,

I have a few questions about the use of land-trusts and LLCs to protect assets. So, I understand the land trust protects the privacy of all owners and the beneficiary of the trust can be an LLC in order to provide the additional level of liability protection if the property gets sued.

In this set up the owner is a member of the (assume multi-member) LLC and so receives a Schedule-K every year, even if the LLC is not active in any business during the year. This is assuming that all of the financial transactions are held within the trust and no income actually flows to the LLC.

So my questions:

Can all of the financial transactions be held completely within the trust, with none of it flowing to the LLC or are there minimum required payments, similar to an S-Corp situation?

What level of protection (if any) does this set up provide if the owner is being sued? Does the owner or the LLC have a legal responsibility to reveal that the LLC is the beneficiary to a trust and thus open the financials of the trust?

Finally, any thoughts on how the level of protection would differ if the owner was "being sued" vs "being divorced"? (assume not community property state)

Thanks,

Lucas