LLC or Trust for one Vacation Rental Property

[Christina Maciejeski]

My brother and I just inherited the family cabin this past winter. Our mother is moving to FL and does not want any financial ties to the property. The cabin is still currently homestead, even though my brother already owns a house that is homestead and myself is not on the title or mortgage on my house with my husband. My brother and I are very happy that we are able to keep the cabin that hold all of our childhood memories but at our age we cannot afford a second property up keep and taxes. So we decided to rent out the cabin this summer to help pay all the cost. We are looking to rent the place so we can break even at $3,00 each summer.
I want to protect my personal assets. Is it better to put the property in a living trust or a LLC? I already have a call into my State Farm rep for additional insurance. I am uneducated with all the up keep of both of them.

Thank you,
CC

[Mitch Kronowit]

In a nutshell (and there are several recent discussions about this on BP), an LLC will help protect your personal assets, a revocable (living) trust will not. Revocable trusts are generally for estate planning (avoiding probate) and not asset protection.