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REVOCABLE V.S. IRREVOCABLE LIVING TRUST

REVOCABLE V.S. IRREVOCABLE LIVING TRUST published on

A revocable trust, often referred to as a living trust, is a legal entity created to hold ownership of an individual’s assets during their lifetime and distribute them to beneficiaries upon their death. The key feature of a revocable trust is that the creator (often called the grantor or settlor) retains the ability to modify or revoke the trust during their lifetime. This means they can add or remove assets, change beneficiaries, or even dissolve the trust altogether if they wish.

An irrevocable trust is a type of trust in which the terms cannot be modified or terminated without the permission of the beneficiaries. Once assets are placed into an irrevocable trust, they are no longer considered the property of the grantor and generally cannot be taken back by the grantor. This is in contrast to a revocable trust, where the grantor retains the ability to modify or revoke the trust. It’s important to note that creating an irrevocable trust involves giving up control and ownership of the assets placed into the trust. Additionally, the tax and legal implications of irrevocable trusts can be complex, so it’s advisable to consult with a legal or financial advisor before creating one.

The main difference between an irrevocable trust agreement and a revocable trust agreement lies in the level of control and flexibility they offer to the grantor (the person creating the trust). There are also estate planning and tax implications, and probate avoidance and privacy to take into consideration.

CONTROL AND FLEXIBILITY

A Revocable Trust provides Control and Flexibility, allowing the grantor to retains control over the assets placed into the trust and can modify or revoke the trust at any time during their lifetime. This includes the ability to change beneficiaries, alter the terms of distribution, or dissolve the trust entirely.

In contrast, an irrevocable trust agreement cannot be modified or revoked by the grantor once it’s established (funded), except under limited circumstances and with the consent of the beneficiaries. The grantor relinquishes control over the assets placed into the trust, which are managed according to the terms outlined in the agreement.

ESTATE PLANNING AND TAX IMPLICATIONS

For estate planning and tax implications, a Revocable Trust typically includes the grantor’s assets in the taxable estate. Since the grantor retains control over the assets, they can still be accessed by creditors and are subject to estate taxes upon the grantor’s death.

In contrast, assets transferred into an irrevocable trust are generally removed from the grantor’s taxable estate, potentially reducing estate taxes. Additionally, depending on the terms of the trust and applicable laws, assets in an irrevocable trust may be protected from creditors and lawsuits.

PROBATE AVOIDANCE AND PRIVACY

For Probate Avoidance and Privacy, both types of trusts can help avoid probate, but irrevocable trusts are typically more effective in this regard because assets held in them are not considered part of the probate estate. Both types of trusts can also provide privacy for the beneficiaries, as the details of the trust and its assets are not typically made public through the probate process.

Overall, the choice between a revocable and an irrevocable trust depends on factors such as the grantor’s goals, estate planning needs, tax considerations, and asset protection objectives.

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The name of the person creating the trust.
The trustee is the person(s) responsible of managing the trust. It can be the settlor or an appointed individual or entity.
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FLAT FEE E-2 VISA

FLAT FEE E-2 VISA published on

An E-2 visa is a nonimmigrant visa that allows individuals from certain treaty countries to enter the United States to establish a business. The E-2 visa is specifically designed for treaty investors and their employees who are seeking to develop and direct their investment enterprise in the United States. The E-2 Visa process is a laborious undertaking and a lengthy process. Spiegel & Utrera, P.A.’s FLAT FEE E-2 VISA service is complete and fee transparent.

Our staff of attorneys have dealt with many aspects of immigration law, including but not limited to:

Business and Investment Visas: E-2, EB-5, L-1, etc.
Employment-Based Visas: H-1B, O-1, TN, etc.
Family-Based Visas: K-1, CR-1, IR-1, etc.
Permanent Residency and Naturalization

We can help you, family members, friends, and business associates with immigration matters.

Submit your contact details to get a free no-obligation consultation.

Individuals who typically seek E-2 visas include business owners or individuals who wish to establish a new business or invest in an existing enterprise in the United States. E-2 visas can also be granted to investors who are interested in investing a significant amount of capital in a U.S. business with the intention of generating profit. Also, qualified employees of investors who are needed to assist in the development and operation of the investment enterprise in the United States. Additionally, spouses and unmarried children under 21 years of age of treaty investors or employees may accompany or follow the primary visa holder to the United States.

Overall, individuals who want to start or expand a business in the United States and are citizens of countries that have treaties of commerce and navigation with the U.S. are prime candidates for E-2 visas. Our Flat Fee E-2 Visa covers the entirety of the lengthy and time-consuming process to get an E-2 Visa decision. Submit your contact details below to speak with an attorney about our FLAT FEE E-2 VISA process.

SUBMIT YOUR DETAILS BELOW FOR A FLAT FEE E-2 VISA CONSULTATION

 

REAL ESTATE INVESTING WITH A PROPERLY STRUCTURED LLC AND OPERATING AGREEMENT IN 2024

REAL ESTATE INVESTING WITH A PROPERLY STRUCTURED LLC AND OPERATING AGREEMENT IN 2024 published on
When you are ready to move forward with your next real estate investment, you may want to consider having our firm CREATE a new or REVIEW your current Limited Liability Company (LLC) and Operating Agreement to make sure you limit your personal assets from liability in the event of litigation. A properly structured Real Estate LLC with an operating agreement allows the owner to buy, sell, or rent their property without the worry of their personal assets being put into jeopardy. LLCs offer strong benefits aside from just liability protection, such as pass-through taxation, and flexibility in business structure. To further protect all your assets, it may be advised to keep a single investment in it’s own Real Estate LLC entity.


Purchasing real estate under the umbrella of an LLC provides the investor with much needed protection for themselves. The protection alone is pivotal for investors to reduce the amount of risk associated with real estate investing. This is crucial for investors to shield their finances from potential legal actions. For instance, if you or a member fail to make payments on a loan for the property and the debt is in the LLC’s name, you would not have to risk wiping out your personal assets to satisfy the remaining loan and creditors will not be able to seek payment from other members in the LLC.

A Limited Liability Company (LLC) is known as a ‘pass through entity’ because they are exempt from paying corporate taxes. Meaning all proceeds of the company are used to pay debts and are then distributed accordingly to its members to pay individual taxes on. Members can then write off the LLC in their taxes as a profit or loss in their personal income. Additionally, if your LLC is used for managing rental properties, you may be eligible for an additional personal income tax deduction. When deciding on the distribution of the companies proceeds, LLCs offer a flexible business structure to apportion appropriately.

To properly structure an LLC, investors use what is known as an Operating Agreement.

Operating Agreements allow the company to set, for each member, a framework to accommodate for each other and to distribute ownership. Setting up operating agreements is only required depending on the state in which the entity has been formed. These can be referenced when needing to resolve problems or disputes that could occur within the company. Unlike Operating Agreements, Articles of Organization must be filed to legally establish the entity with the state. Together they are the framework for your Real Estate LLC.

While purchasing real estate without the protective vail of a limited liability company is legally possible it is deemed unwise. Investors might find that the strategic choice of real estate management through an LLC is a crucial step into the real estate market. With the major advantage of highly mitigating financial risk, tax advantages and asset protection investors can leverage their LLC to venture through the unprecedented world of real estate investing.

CREATE OR REVIEW YOUR REAL ESTATE LLC AND OPERATING AGREEMENT

 

TRANSFER ON DEATH DESIGNATION FOR YOUR BUSINESS

TRANSFER ON DEATH DESIGNATION FOR YOUR BUSINESS published on

A Transfer on Death (TOD) designation for a business is a must if you have more than one member or shareholder. The Transfer on Death is a mechanism that allows the seamless transfer of ownership or control of a business interest to a designated individual upon the death of the current owner. This is a way to plan for the succession of a business without the need for probate.



For example, if a spouse untimely passes away, the Transfer on Death can designate the surviving spouse to receive all of the decease ownership in the business.

The specifics of a Transfer on Death for a business can vary depending on the jurisdiction and the type of business entity. Here are a few common scenarios:

Transfer on Death for Business Interests:

For sole proprietorships or partnerships, the business owner can designate a specific individual or individuals as beneficiaries who will receive the business interest upon the owner’s death.

Transfer on Death for Corporate Stock:

In the case of a corporation, an individual can specify beneficiaries for their shares of stock through a Transfer on Death designation. This allows the designated individuals to inherit the stock outside of probate.

For an LLC, the owner can often designate beneficiaries for their membership interests using a similar TOD designation. It’s crucial to work with legal and financial professionals when setting up a Transfer on Death for a business, as the structure and requirements can vary based on the business type and local laws. Additionally, businesses often have complex ownership structures and contractual agreements that need careful consideration in the estate planning process.

In some cases, a comprehensive business succession plan may involve a combination of tools, such as a Buy-Sell Agreement, a will, or even the establishment of a business trust. These decisions depend on the unique characteristics of the business and the goals of the business owner.

Please submit your contact details below to discuss the Transfer on Death designation for your Corporation or LLC.

 

CONVERTING A SOLE PROPRIETORSHIP TO AN LLC OR CORPORATION

CONVERTING A SOLE PROPRIETORSHIP TO AN LLC OR CORPORATION published on

Some entrepreneurs opt for an easier business model like a sole proprietorship due to its simplicity. However, as a business finds itself growing, they may find it beneficial to go from a sole proprietorship to an LLC or Corporation.

Deciding which business structure to choose plays a significant role when using the entity for anonymity, asset protection, and tax savings.

LIMITED LIABILITY PROTECTION

One reason a business would choose to convert to an LLC or Corporation would be due to the liability protection they offer. Both LLC and Corporations offer a cloak of protection that separate one’s personal assets with the businesses. In essence, if the business under goes financial or legal troubles, personal assets can’t be targeted. Serving as a sort of veil of protection for the business owners’ personal assets. This sort of protection is critical for a business owners own security.

FINANCIAL STRUCTURE

Now, both LLCs and Corporations offer a better financial structure for your business because of the flexibility they offer over a Sole Proprietorship. Corporations have the option to choose between C-Type or S-Type Corporations depending on the circumstances. While LLCs have a pass-through option for the business, allowing the taxes to flow through to the owners’ personal taxes, simplifying the tax process.

PERPETUAL EXISCTENCE

LLC’s and Corporations also have legal requirements and formalities that need to be upheld on an annual basis, like meetings and maintaining proper reports. Even though this might come off as cumbersome to some, this proves to give clarity on the path to success. Unlike sole proprietorships or partnerships which are bound to the life of the owner, Corporations and LLC’s can be passed on to the next generation of owners perpetually. Allowing for clearer business structures, and the ability to draft legal documents. This allows businesses to plan for a solid and financially successful future.

Converting to either an LLC or Corporation should be considered a strategic move for sole proprietorships. This could bring many benefits to your business by bringing tax benefits, liability protection and an opportunity for growth. However, the decision to convert should be made with careful consideration to the specifics of each other’s situation.

Spiegel & Utrera, P.A. offers free legal advice to help you start the process of converting your sole proprietorship into an LLC or Corporation. Submit a request today for immediate legal assistance.

Please submit your contact details below for a FREE consultation on CONVERTING your sole proprietorship to a Corporation or LLC.

 

GIG ECONOMY LLC

GIG ECONOMY LLC published on

The gig economy is also known as the sharing, on-demand, or access economy. It usually includes businesses that operate a digital platform to connect people to provide services to customers.

While there are many types of gig economy businesses, ride-sharing and home rentals are two of the most popular. Users of the digital platform (e.g., Uber, Lyft, Door Dash, VRBO) earn income providing on-demand work, services or goods.

Workers operating as drivers or other on demand work in the gig economy are classified as independent contractors rather than employees. It is recommended that Uber, Lyft, or other on demand workers form a Gig Economy LLC and use this tool to lower your tax bill and to protect your assets.

Benefits of Spiegel & Utrera, P.A.’s Gig Economy LLC

Lower your Tax Bill with a Gig Economy LLC

By reporting Uber, Lyft, Door Dash, VRBO, etc. earnings under the umbrella of a business structure you may be able to lower your tax bill. An accountant or tax preparer will be able to assist you with deductions related to paying for health insurance, setting up a retirement account, claiming the qualified business income deduction, car expenses, depreciation expenses, home office deductions, financing costs for your business.

Avoid Personal liability with a Gig Economy LLC

Working in the gig economy can mean freedom and a better income, but it also means personal liability if there’s an accident or misunderstanding between you, the client, or the digital platform.

You will want to protect yourself and family assets by forming a Gig Economy LLC. LLCs generally don’t require a ton of maintenance, the LLC protects your assets, and offer potential tax savings.

Operating your business as a sole proprietorship (yourself) or as a DBA is not recommend because your personal assets — like your house, car, personal bank accounts, etc. — would be at risk if you are sued.

What are the benefits of forming a Gig Economy LLC

Limited Liability Protection

Starting with the most crucial benefit of a GIG ECONOMY LLC, limited liability can separate the financial and legal obligations of the company from its members. In case of a lawsuit, you can be protected due to a legal shield the entity provides, which defends personal assets. Keep in mind that this liability protection is limited and will not shield a member from wrongful or illicit acts.

Pass-Through Taxes

Another vital benefit of a GIG ECONOMY LLC is its ability to avoid federal income taxes. Taxation will bypass the LLC and go directly for the members’ profits. In this scenario, all of the money earned by the LLC can go straight to the member, and taxation will only occur on their income. Other entities such as a C-Corporation don’t have this advantage, and its leaders are essentially taxed twice.

Simplicity and Flexibility

Other GIG ECONOMY LLC benefits include its ease in formation and simplicity to sustain when compared to other entities. You don’t need to maintain certain company formalities or file taxes for the single-member LLC. You also have the flexibility of functioning as a single-member LLC, a multi-member LLC, or a multi-member LLC led by an operating manager.

Increased Perception of Credibility and Reliability

As a formal business entity, a limited liability company receives the perception of a more trustworthy business structure when compared to an individual or a sole proprietorship. Starting a GIG ECONOMY LLC adds an extra layer of reliability for employees, customers, and other businesses. Your LLC is required to adopt ‘LLC’, ‘L.L.C.’ or ‘limited liability company’ into its name, which immediately lets people know that you are a formal business and not just a fly-by-night company.

Who participates in the Gig economy?

Gig economy workers accounted for 14.1 percent to 20.5 percent of all workers in the United States. Gig economy workers on average are older than the entire workforce and the average age of gig workers has increased more rapidly. In addition, gig economy workers are more likely to be married than all workers, but the spouses of gig economy workers are less likely to have full-time jobs.

ARTICLES OF INCORPORATION 2.0 UPGRADE

ARTICLES OF INCORPORATION 2.0 UPGRADE published on

Over the years, just like updates, improvements, and filings for your business are required, an upgrade of your Articles of Incorporation or Certificate of Organization may be required as well. If you used our firm to form your company, you may already have comprehensive incorporation or articles of organization documents. However, as time goes on and changes occur in your business, a second revision or upgrade to the articles or certificate of organization may be required. Go here to request your Articles of Incorporation 2.0 Upgrade.

Articles of incorporation or certificate of organization serve as the foundational documents for your entity. They outline the name of the corporation, structure of your entity, effective date of formation, purpose, registered agent, principal office, duration, authorized shares, board of directors information, incorporator information and other clauses to protect you and your business.

SHOULD YOU UPGRADE YOUR ARTICLES OF INCORPORATION OR CERTIFICATE OF ORGANIZATION?

Upon review of your Articles of Incorporation or Certificate of Organization, it may be that your document is missing restrictions on the transfer of shares, missing indemnification clauses, and missing special voting rights provisions. Amending your documents to include the ladder mentioned, is a significant upgrade to protect your business, members and directors.

Additionally, the entity will want to have it’s company documents upgraded prior to there being a need for another party or investor to review these documents. It’s important to note that while (in some states) articles of incorporation are a publicly accessible document, certain details and information about the corporation can also be found in other documents, such as annual reports, bylaws, and filings with regulatory agencies. When sharing your articles of incorporation, it’s a good practice to provide complete and accurate company documents to ensure accurate representation of your corporation’s structure and purpose. It’s good practice to keep all your company documents in one place and keep them handy and organized in your company book and binder.

Here are just a few items that may trigger an upgrade to your Articles of Incorporation:

  1. Change in Company Name: If your business decides to change its legal name, you will typically need to upgrade the Articles of Incorporation to reflect this change.
  2. Change in Business Purpose: If there is a significant change in the primary purpose or activities of your business, you may need to upgrade the Articles of Incorporation to reflect the new business purpose.
  3. Change in Share Structure: Any changes to the authorized shares, classes of shares, or the rights and privileges associated with those shares may require an upgrade with an amendment to the Articles of Incorporation.
  4. Change in Directors or Officers: If there is a change in the board of directors or officers of your business, you may need to upgrade the Articles of Incorporation to reflect the new individuals in these positions.
  5. Amendments to Governing Documents: If you wish to make other amendments to the governing documents of your corporation, such as changing the bylaws, you may need to upgrade the Articles of Incorporation to reflect these changes.
  6. Conversion or Merger: If your business undergoes a merger, consolidation, or conversion into a different type of entity, you may need to upgrade the Articles of Incorporation to reflect these structural changes.

GO HERE TO REQUEST YOUR ARTICLES OF INCORPORATION 2.0 UPGRADE

WHO MAY NEED TO REVIEW YOUR ARTICLES OR CERTIFICATE OF ORGANIZATION

  1. Government Authorities: State and local government agencies, such as the Secretary of State’s office or the relevant state’s corporate regulatory body, will have access to your Articles of Incorporation. These agencies use this document to officially recognize and register your corporation.
  2. Internal Use: Members of the corporation, such as shareholders, directors, and officers, often need to access the Articles of Incorporation to understand the organization’s legal structure, purpose, and governance provisions.
  3. Lenders and Financial Institutions: When seeking loans or financing, banks and lenders may request a copy of your Articles of Incorporation to verify your business’s legal existence and structure.
  4. Investors: Potential investors and venture capitalists may request or review the Articles of Incorporation to understand the company’s structure, share classes, and any special rights associated with shares.
  5. Business Partners: When entering into contracts or agreements with other businesses, your partners or vendors may request a copy of the Articles of Incorporation to ensure that they are dealing with a legitimate legal entity.
  6. Legal Counsel: Your corporate attorney or legal advisors may need access to the Articles of Incorporation when providing legal advice or making amendments to the document.
  7. Regulatory Agencies: Depending on your industry, specific regulatory agencies or bodies overseeing your business may require access to your Articles of Incorporation to ensure compliance with industry-specific regulations.
  8. Shareholders or Members: Shareholders and members may request copies of the Articles of Incorporation when participating in corporate governance decisions or to understand the company’s governing rules and structure.
  9. Courts and Litigation: In the event of legal disputes or litigation, courts may require access to the Articles of Incorporation to understand the corporation’s legal structure and relevant details.
  10. Prospective Buyers: If you are considering selling your business, potential buyers may request or review your Articles of Incorporation to understand the company’s legal and financial standing.

GO HERE TO REQUEST YOUR ARTICLES OF INCORPORATION 2.0 UPGRADE

ASSET PROTECTION FOR YOUR PARTICULAR CIRCUMSTANCE IN 2023

ASSET PROTECTION FOR YOUR PARTICULAR CIRCUMSTANCE IN 2023 published on
Spiegel & Utrera, P.A. has helped hundreds of thousands of clients with setting up entities such as Corporations, LLCs, Trusts, and Partnerships over the years. One of the driving forces behind setting up an entity such as a Corporation, LLC, Partnership, or Trust is the idea that you can separate your own personal self from whatever it is you are trying to protect by putting those items into that entity.
Asset Protection
Many people set up entities to protect their assets, and the key to asset protection is asking the right questions! What is it that you are trying to accomplish? Is it a business you’re trying to protect? Is it real estate you’re trying to protect? Is the real estate income producing? Is the business operational? Is it just cash that you are trying to protect? The key to forming an asset protection strategy is to gather what it is you want to accomplish and find out your particular set of circumstances and facts.

Another key to asset protection is anonymity and layering the entity to protect your public records. For example, you may need to create an entity in a state that protects your public records and then use that entity for anonymity in a separate state. Remember, we don’t want anybody to know our strategy as we’re trying to protect our assets.

SUBMIT AN ASSET PROTECTION INQUIRY HERE

If you are a current member of our General Counsel Club, please call our General Counsel Club line at (800) 734-9900 to discuss your asset protection strategy directly with Larry Spiegel.

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