N.California 50/50 partners couple rentals & assets protection

[Oleg P.]

Hello,

I and my partner have purchased 4 rental properties 50/50% in Northern California, I manage them while he does repairs, we also live in California.

We have landlord insurance and hefty Umbrellas on top of it.

The rentals purchased with cash, I was looking into setting proper business formation since day one and couldn't find a good structure to protect the investment. From reading many RE lawyers blogs and podcasts the top two structures it looks like will get the most protections are bellow:

Option 1- Setting land trust for 4 properties with trustee out of state with P.O. Box and different last name ( say a friend or family member) and than set the LLC with both of us limited partners and Land trust as a general partner

Option 2- Setting Wyoming LP that has general partner LLC and limited party us , and LLC has general partner itself and limited partners us.

I know it sounds a bit complicated, but that what I've extracted from vast of the recommendations so far.

Other options had it's own problems as well , like : 

Series LLC are not yet supported in CA

Having each property in separate LLC is financially tough

Also my partner has his own business, and I have concerns if say he will get sued for something else than our business and having us partners under LLC probably can impact me as well?

Looking forward for your comments and suggestions.

If anyone familiar with a reputable assets orientation attorney around Sacramento, someone who know that side of real estate not only from the law school but actually defended clients and won cases? 

[Jerry W.]

@Oleg P., When I do a joint venture I do a single LLC with the other party. I usually have my main LLC as the 1/2 owner, but sometimes do it personally. In WY you are not liable for what the other partner in the LLC personally, but the LLC is liable for the actions of either owner. When it comes to personal liability, in WY they cannot take the partner's share of ownership in the LLC for his personal debts, they can only do a charging order. One caveat is that when you personally work on a property you can in certain circumstances lose the LLC protection. For example if your partner works on the furnace and messes up the exhaust stack and someone dies from carbon monoxide poisoning he will probably be sued personally as well as the LLC being sued. The LLC will not limit the action he took personally. In other words LLCs have much stronger protections if you are not personally working on them. Keep in mind CA law may be different from what I said, as honestly CA is dramatically different from that of most states. Best of luck