Why Your Rental Property Needs It's Own LLC

Let's go back to real estate. I've got this LLC and I bought that rental property that I want to lease back to my operational business. When you go out to build a structure like this, there's a lot of question marks. Who's going to own this building? What happens if there's an accident or a lawsuit? Well, it's kind of funny. This is how the trifecta started to play out for me. It was a wintery day in southern Utah, so I had built my trifecta with an LLC to own the building. And I was saving taxes. I'm getting a write off, renting the property back to myself. There's a really subtle tax strategy here. It's beautiful, but it's also built for asset protection. And so there was this situation where HOA had not been salting the driveway and there was ice everywhere. And my building was part of this HOA situation with my employees coming in and out of the parking lot and coming into the building. Well, one day this employee slipped and fell. She had really broken her arm and wrist and someone's got to pay for that. And we wanted to make sure she was taken care of. And so we start to call our insurance company and the workers comp and all those goodies and of course questions can be asked and there was maybe going to be some sort bigger lawsuit. Insurance companies like to blame someone else and go collect money from someone. Well, when they started to peel away the onion, they said, oh, there's an LLC here. The LLC owns the building. Oh, and Mark's maintaining it and it's protected and oh, this works. Okay. So the insurance paid out. Our employee was taken care of, but there was no big lawsuit, There was no big loss. The structure works.