Can a Trust Own an LLC?

Yes, a trust can own an LLC. This arrangement is often used to enhance asset protection for the trust, better manage estate planning, and streamline the transfer of assets.

When a trust owns an LLC, the LLC (and everything it owns) becomes part of the trust estate.

How It Works

When a trust owns an LLC, the trust becomes a member of the LLC and owns the membership interest.

The trustee can either manage the LLC directly or hire an LLC manager.

Having the trust own an LLC is a good idea to protect the trust from liability stemming from trust property.

One common setup is for a trust to own an LLC, which itself then owns real property. Should any liability arise from the property, the trust itself would not generally be liable. In this way, other trust assets outside of the LLC structure would be insulated from claims originating from the LLC’s assets.

Benefits of Trust-Owned LLCs

1. Asset Protection: A trust-owned LLC can shield the trust from liability stemming from assets in the LLC.
2. Estate Planning: Integrating an LLC allows the LLC owner to direct the inheritance of their LLC after death without having to go through probate.
3. Privacy: The trust can offer anonymity for the LLC’s owner, as the public records of the LLC list the trust and trustee, not the trust grantor or beneficiary.

Setting Up a Trust-Owned LLC in Florida

In Florida, setting up a trust-owned LLC is a simple two-step process. First, you must create the trust. Then, you assign your membership interests in the LLC to the trust.

About the Author

Gideon Alper is an attorney who specializes in asset protection planning. He graduated with honors from Emory University Law School and has been practicing law for almost 15 years.

Gideon and the Alper Law firm have advised thousands of clients about how to protect their assets from creditors.