Hi Mark
Kohler here with another tax and legal tip I want to talk about the wyoming corporation or lLC now these are awesome for asset protection
But they're also oversold so I want to break down some of the good a little bit of the bad
And then tell you where I really like to use the wyoming in it
Okay, the first benefit of a Wyoming entity is the Cope protection now
What cope stands for is charging order Protection entity now?
I whole chapter on my book on Cope entities
But there's only about 13 to 15 states around the country that have this type of protection
let me tell you what it is if you set up a
LlC for your rental property and something goes wrong and
Your tenants licken the mold off the wall or they fall down the stairs
You know because of you know termites or something can they sue you personally? Oh, you're protected
That's the beauty of the lLc. If there's a problem inside the lLC. You're protected, but you
but what happens if you are at a lawsuit heaven Forbid
Texting and driving and someone comes after you can they bust into your lLC and take away your rental in most states they can
But with the charging order protection entity but gee there's outside protection
They can't get into the lLC and take away your rental your rental is
Protected with this coat protection a judge will only give a charging order
That any money that comes out goes to the creditor. That's the charging order protection. They can't get the asset
They only get money if money comes out and are you ever gonna distribute money you're not well?
why don't mean is one of these entities, and they give charging order protection if it is a
Single-Member, LLC, and that's the only state in the country right now. That's awesome
So wyoming entities are great for this quote protection the second benefit of a Wyoming entity is privacy
Because if you ask me to set up your wyoming LLC
I can set it up as the incorporator at the law firm I can even use our mail forwarding address service
So your address doesn't show up anyway. This is pretty cool
So your name doesn't pop up on public record in wyoming for at least a year
At the one-year mark you have to disclose who the manager of the is of the lLC is but not for a whole year
That's huge for privacy protection
Third benefit of the Llc is they're affordable now
I'm gonna come back to the oversell issue in a minute, but you can set up a wyoming lLC for a hundred bucks
we can be your registered agent wyoming for 125 and we can be your mail forwarding for up to three companies for
150 bucks a year so the filing fees are with all that you're still under three or four hundred bucks and then the annual fee
With the state is either 50 or a hundred bucks depending on your sale
So the LLc can be really affordable in wyoming for its initial setup and maintenance a lot cheaper than Nevada which is again
Oversold as well
Now the problem with the wyoming entity is they're oversold too many people get sold into this wyoming entity when they're not even doing
Business in Wyoming, so they got rentals in Georgia, and they're like mark. I need a wyoming entity and I'm like okay now
I've got a registered, Wyoming and Georgia, and if they're just getting started and they don't have a lot of equity in their property
They're paying for two states
And it's just too cost that that brand new investor really doesn't need
But they're oversold again and everybody at every little workshop out there that thinks through a real estate
Legal guru even though they're not lawyers or they're over selling this and it's too expensive
Watch out be careful on overdoing it with a wyoming enemy. So finally let me show you my master diagram here
Here's where I love the wyoming in it
So real quick a lot of times you might have one lLC with multiple properties in it you might have two or three
LlC's with multiple properties
But you have barriers between each one and then you might even have let's make my picture here
Or you might even have a series LLC with little baby subs but you can only do that in a few states
So the series LLC doesn't work for everybody, but when I have a client with a lot of assets
We'll set up a Wyoming energy
And then have baby LlC's in multiple states for their other rentals
Now I get the cope protection of Wyoming and then I get the protection of the LLc's in these multiple states
This could be Arizona. This is Nebraska
This is California, and then we've got Jordan so we got multiple states, but it's one tax return
One LLC, and you're getting charging order, Protection, Wyoming
But I only do this if I have clients with a lot of assets and a lot of rental properties
Now you could probably see why I named this a tax and legal tip and not a 2-minute tip because I sometimes get carried away
Anyway in Summary asset protections for real and it can work, but make sure you have enough passives before you think about this
Wyoming thing folks. Don't give up on your American dream
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you