Transferring rental property to an LLC

[cfsadvsr]

What's the process for transferring residential properties to an LLC? and what are the tax ramifications. Also, who holds the mortgage notes?

[Roland Slugg]

Record a deed

Dear cfsadvsr

If the transfers are to an LLC with the same member(s) as the real estate, and in the same proportions, new deeds should be recorded ... perhaps quitclaim deeds. There may also be other forms to file, depending on state or local requirements.

The mortgage notes will continue to be held by the lenders, who may or may not consent to the transfers and should be asked in advance if the transfers will create any problems.