A Limited Liability Company (LLC) is an easily created corporate structure with many uses. It might be right for an individual looking to pass on a vacation property to their family. When an inherited piece of property is especially desirable, using an LLC to allow an entire family to use it together can create a better, more pleasant future for your family.
What you need to do to set up an LLC
In Washington State, the creation of an LLC requires you to file the appropriate forms with the following pieces of information:
- The LLC’s name: The LLC must have a name unique from other businesses in Washington State and have some version of Limited Liability Company or LLC in it.
- The name of your “registered agent”: A registered agent is the individual who would be notified in case of a lawsuit.
- The expected life of the LLC: LLCs have natural terms: limited or perpetual.
- How is the LLC managed: Is the LLC managed by all LLC group members or just one?
With these simple decisions made, it’s simply a matter of filing the paperwork and awaiting approval.
How is this beneficial?
The most common struggles for family-owned properties are the decisions on maintenance and holidays. Every branch of a family may have different priorities and concerns on both of those questions, creating friction.
However, if you transfer your vacation property to an LLC, you can build the rules for its use and management yourself. By putting the holiday and maintenance rotation in writing, you mitigate the possibility for familial friction.
Settle the issues before they become problems
Planning is an act of kindness to your family. When you make the decisions on your vacation home for your children, they don’t have to figure it out for themselves; they just get to enjoy it.
