Texas LLC - Texas Asset Protection

This website is a service of ,a Texas law firm established in Houston in 1979. Its purpose is to provide asset protection services online, including formation of the new Texas Series Limited Liability Company that was approved for use in Texas in September of 2009. The Texas Series LLC, unlike the traditional Texas LLC, is suitable for real estate investors and others who want to hold multiple properties or businesses within the same company. Its benefits are simplicity and economy. The Texas Series LLC is an outstanding asset protection device and is the core of our recommended asset protection program.

Texas is now the most favorable state in the United States in which to engage in asset protection. No other state exempts the homestead from execution on a judgment (in any amount) and prohibits garnishment of wages. In addition to forming a Texas LLC, Texas investors and business owners should review their portfolio to make sure they are maximizing these protections. Even if you do not now live permanently in Texas, you may still be able to designate your homestead here and protect its full value against lawsuits and judgments. Purchase Texas property, obtain a Texas drivers license, perhaps register to vote . . . and declare yourself a Texan who is entitled to homestead protections. There is no minimum residency requirement.

Mr. Willis is a Texas real estate lawyer and asset protection expert with 30 years experience in transactions and litigation. He is also a licensed real estate broker. As a result of this experience, he is uniquely qualified to design an asset protection program that works. “Elaborate entity structures are useless,” he observes, “unless they can withstand the scrutiny of a judge or jury.” The Texas Series LLC is ideally positioned to do this.

Our articles (the blue buttons above) on the Texas LLC and related topics contain free, detailed information that could cost thousands of dollars at large law firm. Many more articles pertaining to Texas real estate law generally are available on our companion site, www.LoneStarLandLaw.com. For a quick overview of the Texas Series LLC and asset protection, view our powerpoint presentation (click the icon to the right).

WHAT IS A SERIES LLC?

The Texas Series LLC allows different properties and businesses to be held in separate “series” or compartments, each insulated from the liabilities of the other – which is not true of a traditional Texas LLC in which all assets of the company are available to satisfy a judgment. This feature eliminates the need to form multiple Texas LLCs for different properties and projects. A series may own real estate, borrow money, manage property, or operate a business in its own name. In effect, each series is a “sub-company.” It is not necessary to already own multiple properties or businesses; series can be added progressively as the company acquires more property. After forming a Texas LLC, investment property held in a personal name should be moved into the company by means of general or special warranty deed without delay.

Dealings with tenants, vendors, contractors, and the like should be conducted solely in the name of your Texas LLC or its management company. Your personal name should never appear on any deeds or leases, and a tenant should never write a check to an individual member. There is an old rule that people tend to sue whomever they write their checks to, so make sure that is never you personally.

REGISTERED AGENT SERVICES AND ANONYMITY

It should never be easy for anyone to discover the true ownership of your assets or where those assets are located. This office can assist with enhancing your anonymity. For an annual fee, we are available to act as registered agent for the company, receiving official mail and service of process if the company is sued. We may also agree to file all formation paperwork in our name and then privately assign the company to you - thereby eliminating any reference to your name in the initial filing documents. This is our “anonymity option” and is available only to select clients.

What is Asset Protection?

Asset protection is the lawful structuring of assets into one or more proven entities in order to discourage lawsuits and make it difficult for judgment creditors to collect. Principles of asset protection include anonymity of ownership, deterrence of lawsuits and creditor action, and exhaustion of an adversary’s determination and resources.

This is our basic asset protection plan for Texans:

establish a Texas Series LLC for investment properties and businesses;
form a shell management company (it can be a traditional Texas LLC) for dealings with tenants, vendors, contractors, and the public – doing this keeps the asset-holding entity anonymous and out of the loop;
file assumed name certificates (DBA’s) for the Texas Series LLC and for the Texas LLC that has been designated as the management company;
transfer properties held in personal names to the Texas Series LLC;
reduce or eliminate debt on the homestead, personal vehicles, and other exempt items; and
form a living trust for the homestead to avoid probate and execute a “pour over” will to complement the living trust.

Anonymity is a key element of asset protection. Dealings with tenants, vendors, contractors, and the like should be conducted solely in the name of your Texas LLC or (preferably) its management company. Your personal name should never appear on any deeds, leases, or contracts, and a tenant should never write a check to an individual member of the company. There is an old rule that people tend to sue whomever they write their checks to, so make sure that is never you personally.

A living land trust (also called an inter vivos trust) for the homestead is an integral part of our overall program. Living trusts are effective planning devices that achieve both anonymity (they are not registered entities) and avoid probate. Trusts are not just for the rich. This office is as enthusiastic about living trusts as we are about the Texas Series LLC. Both should be used as part of a comprehensive program of asset protection and estate planning.

ONLINE CONSULTATIONS AND SERVICES

Email us your inquiry about the Texas Series LLC. We will respond promptly with preliminary comments. The following options are then available:

Asset Protection Review. This is a good starting point if you are uncertain about whether or not to form a Texas LLC. It includes a comprehensive analysis of your circumstances and goals with recommendations for action. It is conducted online, supplemented by phone and fax. The fee is $250 and is applied to the fee for a Texas LLC or trust.

Formation of a Texas Series LLC. Asset protection planning is included in our $750 fee for a Texas Series LLC, as are follow-up questions after the company is established. The fee for a traditional Texas LLC is $650. Go to Fees for complete fees, costs, and policies.

Deeding Properties into your Texas LLC or Trust. This is essential to implement your asset protection plan. Specially crafted Texas deeds for this purpose are $175 plus recording fees. A reduction is available if three or more properties are involved.

Formation of a Land Trust or Living Trust. Fees range from $550 to $750. A “pour over” will should be executed along with your living trust.

When your new Texas LLC is approved by the Secretary of State, we will ship you a complete company book with official seal, membership certificates, detailed company agreement, minutes of the organizational meeting, and more. We use sophisticated documents designed to achieve maximum asset protection – absolutely no “standard forms” of the type available from discount internet services, which are of limited value in protecting your assets.

Since services offered on this website are priced for online delivery, office meetings may incur an additional charge. We invite you to compare our fees with any board-certified attorney with comparable experience.

CONFIDENTIALITY & ETHICS

This is a law firm and confidentiality is assured. Asset protection is a legitimate and honorable endeavor, and we observe the highest ethical and performance standards in achieving it. We subscribe to The Texas Lawyer’s Creed and the Code of Ethics of the National Association of Realtors.