Condos | Condo Conversions

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Real estate investors and developers should protect their real property estate assets and holdings,

and often insurance coverage is not enough to avoid liability.

 

Julie Alexander has formed over 1000 LLCs and Series LLCs for clients located across the globe with real estate assets in Texas.

 

LLCs are a popular choice in Texas, because (when done right) they offer solid liability protection 

coupled with the ease of use and maintenance lacking in other entity choices.  

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The documents we draft to form an LLC include:

• Certificate of Formation - This is filed with the Texas Secretary of State. A common misconception is this is the only document needed to complete an LLC. No, it's just the document of public record.

• Company Agreement - This is the meat and potatoes document of the LLC. The Company Agreement spells out who owns the LLC, how the LLC is managed, and how LLC decisions are made. It can also be a business pre-nup - what happens if a member dies or divorces? Are you now in business with his or her ex or kids?

• Organizational Meeting - This document is the first meeting of the owners or managers of the LLC, and gets the LLC up and going.

• SS4 & EIN - The LLC should have an IRS tax number different from the owner's social security number.

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"Avoid the domino effect of a problem at one property impacting your other properties."

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Series LLCs offer liability protection for real estate holdings in a more tidy org chart.

 

Sometimes they are better for a client, and sometimes traditional LLCs are better, depending on the client's assets, financing and development plans. Series LLCs may also save a client money in filing fees and legal fees. 

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The documents we draft to form a Series LLC include all of the above LLC documents,

supplemented with language allowing for the series.

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The documents we draft to form a series of the Series LLC include:

• Supplement to the Company Agreement - This document amends the Company Agreement to allow the creation of a new series. A series is not a stand alone or separate legal entity, and it may only exist inside of a living LLC. If the LLC dies, all the series die.

• Approval of the Series - The main LLC must approve the formation of the series.

• Assumed Name Certificate - The series should file an assumed name with the Texas Secretary of State. If this is not done, it will impair the liability protection of the series structure.

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Once all this paperwork is complete (although the picture on our home page is a pile of paper, our office forms paperless LLCs, which makes us popular with the trees and is also handy for our clients who live in places other than Austin), the final detail is to transfer the real property asset into the LLC, series LLC or series of the series LLC through a warranty deed. Julie also consults with clients about the risks and benefits of doing this transfer on a real property that has an existing mortgage.

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If you have a real property that you would like to put into an entity like an LLC or a Series LLC, Julie will prepare a proposal for your entity structure at no charge. The proposal will be structured as a flat fee, so you know if her services work with your budget.

 

We systemize our processes to keep our fees affordable to both seasoned and beginning real estate investors.

LLCs and Series LLCs are often completed in our office

in less than a week. 

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