Should I put my rental property in an LLC?

[Anonymous]

I only own one rental property, which is a condo in Montgomery County worth about $650,000. It is paid off and this accounts for a significant percentage of my net worth. I’ve never had any problems but I’m just concerned about the remote possibility that somebody could slip and fall or something like that and then sue me.

I’m wondering if there’s any advantage to moving the property into an LLC or some other entity. It is currently simply in my name. I would prefer not to do this to avoid the legal cost and possible increased charges from my accountant at tax time. Is something like this necessary or advisable? Should I get an umbrella policy instead? Thanks for your assistance.

[Anonymous]

It is legally safer to put it in an LLC.
But you have to treat it as truly separate entity without commingling the funds.
I am in business but not a lawyer.

[Anonymous]

Anonymous wrote:It is legally safer to put it in an LLC.
But you have to treat it as truly separate entity without commingling the funds.
I am in business but not a lawyer.

+1. Personally I would probably just see if your insurance is all up to date and the cost of an umbrella policy because for an LLC to have benefit you have to really change the way you operate (collecting and writing checks etc)

[Anonymous]

Get an umbrella policy, it is cheap. LLC makes homeowners and title insurance harder to get and doesn’t really protect as much as people think it does.
- 6 rental properties

[Anonymous]

$5 million umbrella policy over years will cost you less than the one-time transfer fees/taxes. And require your tenants in the lease to have a renters policy.