Montana LLC Re-Visited
Hi guys, I recently spoke to someone who became a full timer and the conversation was interesting. He told me that he sold his home in New York and set up a Montana LLC. He then purchased a new MH...
Forum Discussion
wnytaxman wrote:
Effy, An LLC is NOT a business. I repeat, it is NOT a business. An LLC is an asset protection tool regarding lawsuits not a business. People who put their personal residence into an LLC are not evading or avoiding taxes. They are protecting themselves from lawsuits. Their house isn't a business, but if someone gets hurt on their property they want to protect their other assets. How can that even remotely be illegal?
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I don't think I am the one confused. Why does it ask the purpose of the business on the articles of organization? Sure people use them to shelter assets. But an LLC's intended purpose is for business. An LLC is not a "warehouse" for assets. Sure you can buy assets under an LLC. But lets be clear and use a little common sense. Per the definition: "A limited liability company (LLC) is a flexible form of enterprise that blends elements of partnership and corporate structures. An LLC is not a corporation; it is a legal form of COMPANY that provides limited liability to its owners in the vast majority of United States jurisdictions." I am sorry and perhaps we will just have to agree to disagree but this is pretty condradictory to your claim above and I struggle to see how this "fits" with buying a MH or any other luxury item for personal use. I get it that there are loopholes and people take advantage and thereby it can be legal. But I think you continue to miss my point in that it is NOT the intended purpose for an LLC and to me it's wrong. I am probably a minority here but if I would not want to have to answer questions about a business I bought a MH in for personal use. Maybe I'm weird. I have LLC's - 3 as a matter of fact to operate commercial rental properties. Real companies. You can't just go out and buy a house under an LLC unless you are liquid enough to lay out the capital. Otherwise the bank will ask you why. Why do they ask? Becuase it would require a commercial loan. WHy is that? Because it's supposed to be a company. They also like to see net worth docs and income statements as well as a business plan. Why?, well you get the point.
