CA Investor - Investing Out-of-State - LLC or Umbrella Policy?

[Brian Dudash]

I'm living in California and I'm in the process of getting a rental that is out-of-state (OH, specifically). I just recently found out about the ridiculous CA Tax for a Foreign LLC operating/doing "business" in CA, which even a basic phone call is considered "business". Since this tax is $800 per year, that really eats into my cashflow. The only thing I could think of is if my brother or parents, who still live in OH, become the LLC member(s) but I don't really want to put that burden on them (and not sure if that is even "legal").

The other option it seems that I'd have to go with is an Umbrella Policy which should be cheaper, when compared to the LLC and the dumb CA tax (but I do not have an Umbrella quote yet).

Are there any other reasonable options for coverage against your personal property/financials in case of legal issues? I guess this is probably aimed more for other CA residents that have rentals out-of-state but I'm open to anyone's opinions/options!