Minneapolis Lawyer familiar with elderly asset protection and RE

[Jon Loca]

My father and I purchased a property 2 years ago cash. At the time of the purchase the property was deeded solely to his name. I would like to now transfer the deed to an LLC, in my name, while doing a cash out refinance so my dad can pay some of his bills. I know their is a plethora of legal and tax concerns. I'm looking for someone who can help navigate this territory. In the end I would like the property in an LLC owned by me without implicating a tax "gift" and I would like the new debt to be an expense to the rental property. Any suggestions or contacts would be much appreciated.

[Tim Joyce]

[I'm not an expert in this kind of planning, unfortunately. I know the LLC mechanics, but tax is still a bit above my head.]

Hey @John Woodrich - from tax perspective, do you have an opinion one way or the other if @Jon Loca did the following:

• Dad deeds property over to LLC, for "consideration less than $500" to avoid hefty deed tax when recording.
• Dad invites his partner-son to become a small part-owner of the operation of the business that is this rental property by buying into the LLC for "services to be performed"
• Lender like @Tim Swierczek helps get the property refi'd under the LLC, with cash distributed pro rata to the owners -- does that get ordinary income, or capital gains treatment? (Dad gets $$ for bills, but pays cap gains rate on it, right?)
• Then, over the course of years, Dad yearly "gifts" the legal maximum ($14K?) to son in equity of the company (so ownership percentage, and therefore share of future distributions, grows without(?) any tax consequence).

What did I miss in terms of taxable events? Does it impact it if Jon becomes an owner after the cash-out refi? Does this potentially solve the problem?