27
1 New Special Report: 7 Ways To Make Your LLC A Money-Saving Protection Machine …Attorneys Do Not Know Authors: Albert Aiello, CPA, MS Taxation, RE Investor, National Speaker William Noll, Attorney/CPA ALL RIGHTS RESERVED BY STRICT COPYRIGHT LAW Copyright 2014 - All Rights Reserved. Printed in the United States of America. First edition. Copyright - Information Services Unlimited (ISU). Since you’ve already signed up, to join the Webinar, go here: http://www.creonline.com/webinars/LLC/webinar.html _____________________________________________________________ ALL Real Estate Investors Will Benefit From This Report Beginners (even if you do yet own property), Veterans, Full time, Part time Wholesalers, Shortsalers Rehabbers, Foreclosers Landlords, Rental Property Commercial, Paper, Etc.

7 Ways To Make Your LLC A Money-Saving Protection · PDF file7 Ways To Make Your ... And too much insurance may even invite lawsuits! ... IRS audit defense 10. Supporting tax strategies

  • Upload
    lehanh

  • View
    214

  • Download
    2

Embed Size (px)

Citation preview

1

New Special Report:

7 Ways To Make Your

LLC A Money-Saving

Protection Machine

…Attorneys Do Not Know

Authors: Albert Aiello, CPA, MS Taxation, RE Investor, National Speaker

William Noll, Attorney/CPA

ALL RIGHTS RESERVED BY STRICT COPYRIGHT LAW

Copyright 2014 - All Rights Reserved. Printed in the United States of America. First edition.

Copyright - Information Services Unlimited (ISU).

Since you’ve already signed up, to join the Webinar, go here:

http://www.creonline.com/webinars/LLC/webinar.html

_____________________________________________________________

ALL Real Estate Investors Will Benefit From This Report…

Beginners (even if you do yet own property),

Veterans, Full time, Part time

Wholesalers, Shortsalers

Rehabbers, Foreclosers

Landlords, Rental Property

Commercial, Paper, Etc.

2

Let’s begin…

Real Estate Investors: You can be sued…

By anyone

At anytime

For any reason

Even if you do everything right (which you should)

You are totally innocent !

The proof of this is that 82,000 lawsuits are filed DAILY in the

US! Many of them are frivolous which means they have no

economic substance but the adverse consequences are for real.

The average person will get sued seven times in their lifetime.

That’s “average”. If you are a real estate investor it can be even

more. So it’s not “if”, it’s WHEN!!

This is because real estate is a HIGH Liability-Risk asset

interacting with tenants, contractors, partners, even family and

others (all who can sue you) and subject to many regulations!

One lawsuit can wipe out you and your family! It happens much

more than you think!!

Moreover, even if you win the lawsuit, you can still be wiped out

by the legal costs and business losses, which happens so often.

The only ones who win in a legal action are lawyers!

3

The Insurance Myth!

“My lawyer said umbrella insurance is enough to protect me. I do

not need an LLC.” …Some dumb RE investor on the internet.

With stupid lawyers like that who needs enemies!

You should absolutely have liability insurance. But insurance does

not protect you from legal disputes with tenants, contractors,

partners (including family members) and others as follows:

Disputes with tenants over…

Rent increases

Lease terms

Past due rents, evictions

“Refrig not working – No food”

“No heat – getting sick”

“Emotional distress”

You name it!

Disputes with contractors over…

Hidden Fees

Work performed (or not performed or poorly performed)

Materials used (or not used)

Agreement terms

Mechanics liens

4

Disputes with partners (Including family members)

over…

Profit splitting - Who gets what?

Duties – who does what?

Management decisions – who decides what?

Anything!

Disputes With Others…

Vendor\suppliers

Real estate agents

Management companies

Title companies

Anyone you deal with.

…All that can lead to costly time-consuming aggravating

lawsuits.

Insurance does not pay you for attorney fees and court costs related

to these uninsured legal actions

Insurance also does not…

Protect you from liability claims that exceed limits, even high

umbrella limits (which happens more than you think)

Protect you from claims that the insurance company says are

not covered (that you thought were covered)

PREVENT lawsuits from ever happening (Lawsuit Prevention)

5

And too much insurance may even invite lawsuits!

Unlike A Properly Structured And Documented LLC

Insurance also does NOT…

Give you financial privacy (the cornerstone of asset protection

and lawsuit prevention)

Defend you in a costly audit against the most powerful of all >

IRS!

Support Tax-Saving Strategies (which can amount to $1,000’)

RECAP of what insurance does not cover:

1. Tenant disputes

2. Contractor disputes

3. Partner/family disputes

4. Other disputes

5. Related legal fees and court costs

6. Claims that exceed limits

7. Claims insurance company says are not covered

8. Financial privacy

9. IRS audit defense

10. Supporting tax strategies

Add to this…

11. Environmental issues – lead paint, radon, mold, etc.

12. Fair housing violations – even unintentional ones.

6

A properly structured LLC can give you all of the aforementioned

protection-benefits that insurance does not.

The primary purpose of this report is to give you the path to

protect you and your family by putting the legal system in your

favor and not lawyers.

The nuclear vehicle for accomplishing this is the limited liability

company or LLC. An LLC is basically defined as a hybrid business

entity filed under state law, in which all partner-owners (called

“members” or “managers”) have limited legal liability.

While that is the basic definition, it does not tell you the whole

story. That is, just because you set up an LLC with a state corporate

bureau, does not mean you are protected and does not mean you get

the other benefits (such as tax savings) from an LLC. You only get

one of the parts – an LLC, that’s it! I am going to show you how to

get all of the necessary high-grade parts so your LLC is a well-

oiled money-saving machine operating 24-7.

To attain this, the LLC must be properly structured with the very

important missing parts as follows:

PART 1. THE RIGHT FORMATION STATE: “When You Hear

Nevada And Entities Grab Your Wallet And Run The Other Way.”

(William Noll, Attorney/CPA). For new LLC set up’s, the general rule

is the formation state should be the state of the property’s physical

location, not an outside state like Nevada.

7

Reason: The courts of the property’s physical location will have

primary jurisdiction over legal actions, not the outside state. Plus,

more costs & paperwork such as foreign entity registrations

For example, if you form your LLC in Nevada and own properties in

MD you must file and pay for a foreign entity registration with MD.

in order to legally do business in MD. The better way would be to

make MD, not Nevada, the LLC formation state with no foreign

entity registration necessary. Foreign entity registrations, besides the

paper work, could be expensive!

ALERT 1: Do Not Let Unscrupulous Nevada Promoters* Con

You Into Worthless Entities And Unnecessarily Pay Thousands

As So Many Have Regretted! (*UPDATE: One of these rip off

Nevada promoters from Reno went bankrupt – Divine Justice!)

ALERT 2: Nevada no longer has privacy!! The best privacy state

is the first LLC state – Wyoming. Later I will tell you when to use

this low cost state with excellent Wyoming privacy.

_______________________________________________________

PART 2. PRIVACY: Maintaining Privacy Is Fundamental To

Lawsuit Prevention - Which Is Stopping Lawsuits Before They

Even Ever Begin. One weak link with privacy is this - with your

LLC formation in every state you must complete the articles of

organization which is a public document. In many states, you must

include the member-owners who then become part of the public

records and are not private. But the articles are only your application

for the LLC formation. They have no other purpose and do not govern

8

LLC operations and do not determine who the real members are. It is

the LLC operating agreement and other private documents (covered

next) that do this. Therefore who is listed in the articles does not have

to become an actual member once the LLC is operating. So the

strategy is to list a nominee member or organizer in the articles and

not you or any other actual member-owners.

______________________________________________________

PART 3. USE THE PROPER AND COMPLETE

DOCUMENTATION: Again the articles are only your application

for your LLC set up in the formation state. That’s it! While they are

the only public LLC document, they do not govern LLC operations

in any way; they do not determine who the actual members are. The

four most important LLC legal documents (which are private) that

govern LLC operations, protect your personal assets and determine

who the actual members are…

(1) Operating Agreement (OA)

(2) Minutes of Meetings

(3) LLC Certificates of Ownership

(4) Resolutions

(1) OA - The operating agreement is the nuclear, governing

instrument that mandates LLC operations and determines who the

real member-owners are. It is the Heart & Soul of the LLC! A

properly designed operating agreement (which most are not) is to

be specifically targeted for real estate. It is to be comprehensive by

including every legal facet of your real estate investment operations

which is essential for ironclad protection.

9

A properly designed operating agreement should also include…Tax

Provisions that authorize and support a multitude of real estate

tax-saving strategies completely backed up by tax law cites, along

with total IRS compliance to ensure your LLC is operating legally

within IRS Regulations*.

*ALERT: Just about all attorneys, CPA’s, Nevada promoters and

others do not even think of setting up your LLC to protect you

from the most powerful, dangerous predicator-creditor – IRS!

How important is that!!

(2) Minutes - Every LLC state statute requires minutes of meetings

as an important entity formality. The courts have stated that actions

without minutes can make the LLC members personally liable or

bind the LLC to unwanted transactions. Who needs that!

TAX TIP: Have your documented LLC meetings in a nice travel

location, deduct the trip… Let the tax savings pay for the trip!

Next important LLC document…

(3) LLC Membership Certificates - Like stock (shares) in a

corporation, the LLC units* evidences your ownership in the LLC

to prevent all kinds of costly time-consuming legal disputes with

partners, family, creditors, lawyers, IRS, etc.

(*With an LLC, the ownership shares are technically called

“units”; same concept as stock or shares as they represent and

document your ownership in the LLC entity).

10

Last important LLC document…

(4) Resolutions - Written records of the members, without in-

person meetings, authorizing important LLC decisions, such as

buying or selling a property. They are an essential part of entity

formality to prevent veil piercing*.

[*Veil Piercing (VP) is when a court ignores the entity and reaches

the personal assets of the members. It is a common enemy weapon

for collapsing LLC’s (esp. small LLC’s) and exposing your personal

assets to attachment. The absolute best protection against VP is the

formality of these properly designed documents].

The adverse consequences without such legal documents…

ON THE LEGAL SIDE: Without such documents and

formalities your LLC can be collapsed with your personal assets

totally exposed (esp. small LLC’s which most of us are)

ON THE TAX SIDE: The POWERFUL IRS will try to collapse

the LLC entity to disallow valuable deductions such as education,

travel, entertainment, meals, auto and others which can amount to

thousands = You LOSE $$$ !

NOTE – PRIVATE DOCUMENTS: Unlike the articles of

organization, these documents are totally private and not at all

public. Like underground missiles, you only disclose them in the

event of a legal action such as a lawsuit, IRS audit or other action.

11

Properly done*, they will be a very effective and powerful defense

against these actions.

*ALERT: The documents you get from attorneys, CPA’s,

Nevada promoters, the internet, whoever > are incomplete,

worthless, and will not protect you the way properly

structured documents should. More on this later.

_______________________________________________________

PART 4. THE BEST TAX ENTITY FOR REAL ESTATE:

A Partnership Filing IRS Form 1065. On the legal side, an LLC-

Partnership is set up as an LLC with the formation state. Then on the

tax side, with at least two members, is automatically elected to be

taxed as a partnership, without having to notify IRS or the state. In

short, it is a two or more member LLC. If this entity is properly

structured, on the legal side it gives you corporate limited liability

protecting your personal assets; on the tax side gives you the best flow-

through tax benefits for real estate; and on the IRS side a lower IRS

audit profile… filing Form 1065 which is audited less than Schedule C,

Schedule E and corporation tax returns. Below is an outline of this

effective three-sided entity approach.

LLC-Partnership

Legal Side_ Tax Side__ IRS Side__

Limited liability

protecting your

personal assets

Partnership = most

favorable flow-thru

tax benefits for real

estate

Low IRS audit profile

files Form 1065,

nnoott hhiigghhllyy aauuddiitteedd

SScchh.. CC oorr EE

12

Why The LLC-Partnership Is Superior To Other Entities

For real estate investments (keepers and flippers) real estate.

the following forms of ownership have serious legal or tax pitfalls

(or both), in a nutshell as follows:

_Schedule C, Schedule E – No legal protection; very high IRS audit risk.

_General partnership – Great tax benefits, but no legal protection. You

are both jointly and severally liable for your own actions and those of

your partners.

_Limited partnership (LP), family limited partnership (FLP) –

Totally subject to IRS passive loss limits preventing you from deducting

property tax losses against your other income, losing tax savings

(money). They are complex. FLP’s are also very much subject to IRS

scrutiny, especially when used for estate planning.

_Limited liability partnership (LLP) – Specifically designed for

attorneys, CPA’s, other professionals to protect against malpractice suits.

Not designed for real estate. You do not put a round peg in a square hole.

_Limited liability limited partnership (LLLP) - Totally subject to IRS

passive loss limits preventing you from deducting property tax losses

against your other income; may not be recognized by some states.

13

_S-corporation – Very high IRS exposure (the most IRS litigated entity

where the taxpayer almost always losses); owners must be paid highly

taxed W-2 salaries with garbage payroll taxes and filings; limits on

deducting losses; other costly complex tax pitfalls.

_Single member (disregarded) LLC – This is where there is one

member – you. Not considered an “entity” so does not prevent veil

piercing to protect you; other legal detriments. Very high IRS audit risk

filing nasty Schedule C or Schedule E.

_C-corporation – Numerous tax pitfalls as a primary real estate

holding entity such as…higher IRS audit risk; double taxation;

losses do not flow to your 1040 to offset other income; numerous

penalty taxes; complex. But an exception is if you use the C-corp as

a 2% minority partner-member of the LLC-Partnership where you

and the C-corp would be partners of the LLC-Partnership. As a

minority member, you can take advantage of special C-corp

deductions and eliminate the above pitfalls. This is discussed

shortly.

In summary, the above ownership forms do not have the best of all

of the above three sides (legal, tax, IRS) the way an LLC-

Partnership does. In other words a properly structured LLC-

Partnership does not have the above pitfalls of these other ownership

forms. Truly it is the ideal entity for real estate.

14

With a partnership you need at least two legal persons as partner-

members. If you need a partner (a second person) to create the

partnership, below can be a partner with a low ownership % so you

still control…

• Your Spouse

• Another family member

• Another entity you own such as a C-corporation, see next.

_______________________________________________________

PART 5. SUPER C-CORP STRATEGY: Your own

C-corporation can be a 2% partner-member of the LLC with you as

the 98% majority member to create the LLC-partnership with you

and your C-corp as the partner-members. Not only do you create the

advantageous partnership tax entity, but you also reap additional

savings with the C-corp - which has special deductions other entities

do you not have. And because the C-corp is only a 2% minority

member you can reap these benefits yet avoid C-corp tax pitfalls.

An outline of this structure is below.

LLC-PARTNERSHIP ENTITY

You – 98% Member

C-corp – 2% Member

= Additional savings via C-corp special deductions

(including deductible tax-free rent per below) yet without

C-corp disadvantages (because the C-corp is a

minority member)

15

So all types of real estate investors can discover hidden savings by

making a C-corp a 2% minority member of an LLC, including

deductible Tax-FREE Rent = more savings. Here is how it works…

_This flow-thru LLC-partnership entity (with the C-corp 2%

member) pays you rent for the use of your home for business

meetings and functions one day every month (12 days a year).

_The flow-thru LLC-partnership entity deducts the rent

_You do not report the rent, because you rented your home for 14

days or less. That is, under IRS provisions you can rent your home

annually for 14 days or less and the rent is tax-free. (This strategy

with the rent being paid to you - only works with a C-corporation

and no other entity, which is why the C-corp is integrated with this

strategy elevating entity structuring to a very high level…an art!)

Example: The LLC pays you rent of $1,000 a month, annual total

$12,000. The LLC deducts $12,000…which decreases LLC net

income, or increases LLC net loss (whatever the case may be). Such

income decrease or loss increase flows to your 1040. In a 30% tax

bracket you save $3600, every year (like an annuity)… and it’s still

all of your money going from one pocket to another pocket = found

tax-free cash!

PLUS: More savings from other C-corp deductions (such as

medical) and you are better protected from legal actions (asset

protection) and from IRS (audit-proofing) with an LLC-partnership.

16

PLUS:

There are NO corporation tax pitfalls, because the C-corp is a

2% minority LLC member where you can reap its benefits, yet

avoid its tax pitfalls if it were a primary holding entity.

Wyoming - The C-corp can be a low cost/high privacy

Wyoming entity because the C-corp has a limited (money-

saving) role; it does not own property with no need to file

foreign registrations.

All this equates to…

Limited liability protection

Privacy

Best flow-thru tax benefits

Low IRS audit risk.

Best of all Worlds! You Save $1,000’s!!

PLUS: By having an LLC entity properly set up, beginning investors

can fully and safely deduct real estate education. Even if you have not

yet closed on a transaction, even if you did not have an LLC at the

time you incurred the above expenses! It’s all knowing how!!

_______________________________________________________

Speaking of beginners, before getting to the next part, let me

interject with a brief interlude by addressing something that is

important to all, but especially beginners. It is the beginner’s recipe

17

for FAILURE, “Before I set up an LLC, I want to do my first

deal!” WRONG!

FACT: Beginning investors make the most costly blunders and

not having an LLC properly set up is a BIG one! Without a

properly structured LLC…

You have NO privacy, totally exposed. This can later haunt

you or adversely affect you even now

You have NO protection - one great deal and you have

assets that are not protected

You have very high IRS audit risk.

Actual Case Study: Terry S. (from Minn.), A beginner…

deducted his real estate education on highly audited IRS Schedules

with NO LLC and with NO documentation. Costly consequences –

IRS AUDIT! For 2 years of audits he had to pay

in taxes, interest, penalties & legal fees a Total

of $21,400! Plus the time and STRESS!!

This traumatic experience discouraged Terry

from ever becoming a real estate investor,

potentially costing him tens of thousands.

As what happens so often.

With A Properly Structured LLC: You are set up, in business…

ready to safely do deals with privacy; protection; and IRS audit

proofing without costly disasters such as what happened to

18

Terry and to many others. This is FOUNDATIONAL! You do

this first, before anything else like building a house.

_______________________________________________________

On to the next part…

PART 6. THE TWO LLC STRATEGY: Save thousands by

protecting any number of properties in any number of states with

Equity Stripping, which is using controlled debt to eliminate

property equity as a deterrent to ward off wrongful creditors and

their lawyers.

Before further defining equity stripping, let’s discuss the problem -

while a properly structured LLC protects your personal assets

outside the LLC. it does not protect your equity within the LLC

Entity. NO entity does this.

For multiple properties, the typical (wrong) advice to protect equity

is an LLC for every property? But this can be very expensive and

time-consuming. It is not necessary to have an LLC for every

property to protect property equity. You can use one Real Estate

LLC-Partnership for all properties – keepers and non-dealer flippers

in the same LLC entity. Moreover, multiple LLC’s (an LLC for

every property) does not totally remove the equity and therefore

does not totally protect you. It only segments the equity into a

smaller size (which will grow over time).

Example: There are six properties with total equity $300,000,

$50,000 equity in each property which is placed in six separate

19

LLC’s. Despite having to deal with six entities, you still have

$50,000 equity in each LLC which over time will grow to a larger

size with appreciation, amortization and any upgrading.

LOW COST/HIGHLY EFFECTIVE SOLUTION is Equity

Stripping (ES) which…

_Totally removes the equity including future appreciation.

_Is two LLC’s to protect any no. of properties in any no. of states.

_Best, cheapest and only way to protect your property equity.

Definition: ES is using another second LLC (“lender LLC”) to

create secured loans on properties in your “real estate LLC” so there

is NO equity and NO target for wrongful creditors, money-hungry

lawyers, other demons. ES is the same as getting mortgage

refinancing, or a secured line of credit (like a HELOC) from an

outside lender (“this is called commercial ES); except here the

lender is your own LLC company (“this is called controlled ES”).

You are in total control.

So with ES there are two LLC’s (1) The Real Estate LLC owning all

of your property and (2) The Lender LLC owning the mortgage loan

made to the real estate LLC (which is now debt to the RE LLC and a

receivable asset to the lender LLC).

The lender LLC can be in Wyoming (which has excellent privacy

and low state fees) because it only owns paper, with no need to file

foreign registrations. The Lender LLC is not reachable by claimants

20

with superb Wyoming privacy owning a non-risk asset - the

mortgage receivable, namely “paper” which does not cause lawsuits,

as there are NO tenants, NO contractors, NO environmental, NO

such detriments.

So with the secured loan you have transferred your equity from a

high risk real estate LLC to a safe place - the lender Wyoming LLC

(“ES is also known as Equity Transfer”. You still have your equity

you just transferred to a safe hidden pocket).

The ES loan terms between the lender and real estate LLC’s are:

There are no loan payments, including no interest payments, no

payments at all

Interest (at market rates) is accrued and added to the loan

balance (so the ES loan increases with property appreciation)

The ES loan will be paid off when you liquidate and sell off

your properties, going from one pocket to the other

ES does NOT adversely affect:

Your credit report (you would not report yourself)

Your cash flow (there are no payments)

Your equity (just your pockets change)

Refinancing (you can subordinate the ES loan to a junior

position if you are refinancing with an outside lender)

Doing a 1031 exchange

21

Operating your business

Anything.

Controlled equity stripping can be done with…

Temporarily borrowed funds

Your own funds, or

Without any cash funds at all (a credit line like a HELOC loan)

…as part of the secured loan, stripping out the property equity in the

real estate LLC.

POSITIVE RESULT: You have a BIG FAT LIEN on your real

estate, eroding the property equity and warding off claimants along

with their money-lust lawyers, the way a cat scares off rats !

Two (or Three*) LLC’s to protect you with any number of

properties in any number of states. You literally, save $1,000’s in

legal fees; accounting fees; state fees...plus your time!

[*A third LLC would be the C-corp with the previously discussed Super C-

Corp Strategy. But this strategy saves you money and with multiple

properties, three LLC’s is still a lot less expensive than multiple LLC’s].

Equity Stripping is a prime example of effective Lawsuit Prevention

that liability insurance does not give you; and is effective in all 50

states, including yours. It is also superior to the series LLC.

_______________________________________________________

PART 7. INTEGRATE YOUR LLC WITH AN ASSET

PROTECTION AND ESTATE PLANNING TRUST: This is by

22

transferring your ownership interest in your LLC (units or

shares), and other personal assets into a trust. This is the last

important part of your LLC machinery. There are many different

types of trusts with the most popular one being the revocable living

trust (RLT), which is an estate planning trust. Superior to a will, an

RLT avoids probate upon the death of the grantor and manages the

trust assets during any periods of grantor incapacity, while the

grantor is still alive.

ALERT: The big drawback of an RLT is that it does not protect you

because it is revocable and is not an entity; it’s an arrangement.

SOLUTION – AN IRREVOCABLE TRUST: A properly

structured irrevocable trust is recognized by the American legal

system as a legal entity separate and distinct from the owner-

grantors very much the same way a properly structured LLC is an

entity separate and distinct from its owner-members (via this report).

You can revoke the irrevocable. Here, irrevocable really means

that only the majority owners of the trust can undo (revoke) the trust

by written consent. NO one else (including minority owners,

creditors, claimants, lawyers, or other outsiders) can revoke the

entity. That is, they cannot revoke the trust. It is this very

irrevocability that gives the trust entity the limited liability shield of

protection from claimants.

23

The Power-Elite Trust (PET): The PET is a special type of

irrevocable trust which gives you asset protection because it is an

independent legal entity. Unlike any other trust, The PET is

superbly designed as three trusts into one…

(1) Family Legacy Trust - To protect your family if you are ever

incapacitated; to care for minor/handicapped children or other

family members. Upon your demise, to automatically transfer your

estate to your intended heirs without delay, without expensive

probate, without contest from unwanted heirs, X-spouses, future

gold-digging spouses, con artists, etc.

(2) A Privacy Trust - Your personal assets are not in your name but

in the name of the trust. You’re invisible!

(3) An Intrepid Asset Protection Trust - Giving you ironclad

protection, shielding all of your personal assets from claimants,

lawsuits, lawyers, public-exposure, divorce, and other eradicators of

your wealth.

The PET privatizes and protects the following personal family

assets:

Ownership shares of your LLC (units) and other entities

Your home, second home, vehicles

Bank accounts, brokerage accounts, securities, annuities, etc.

Personal valuables – antiques, collections, expensive jewelry, etc.

24

These assets have value, are subject to attachment and probate, but

not if they are in the PET. You’re totally protected, yet still control.

The PET has NO adverse tax consequences whatsoever. There are

no tax filings; they are invisible to IRS. Internal Revenue Code

Sections 671-678.

The PET has the best of all worlds:

Probate avoidance

Impossible to contest

Trust Management

Privacy

Asset protection

No negative tax consequences

No bad side effects whatsoever.

A Financial Disaster Without The PET: There are many. Here is

one notable one from one of my nice students - Thomas Vareya

from New York who states…“About the real estate

investor\landlord who was sued by the parents of their son a student

who was a tenant of one of the investor’s properties. The student

(tenant) locked himself out, scaled to the top of the house to get

in, but fell and became permanently paralyzed.

Then their lawyer realized the investor’s LLC's certificates were

considered personal property so the lawyer sued and won, wiping

out the investor completely.”

AA COMMENT: In another words, to attach personal assets

instead of initially trying to collapse the LLC entity itself (LLC

25

front door), the lawyer went right through > the LLC back door

attaching the investor’s totally exposed LLC membership

certificates (units) and then collapsed the LLC entity to attached

personal assets. This is a form of “reverse veil piercing”, a

dangerous and very effective weapon against unprotected assets, as

demonstrated above. With the PET this type disaster would have

never happened.

Put not your trust in money, but your money in trust! The PET.

______________________________________________________

WARNING! Attorneys, CPA's, Nevada Promoters

and others > sock you with big fees, yet use

bare bones worthless documents and do a lousy

job.

YOU WILL PAY THE CONSEQUENCES: Your asset

protection structure is set up WRONG > a BIG

TARGET for expensive, time-consuming lawsuits,

IRS audits or other actions. And you pay

Thousands in fees for this MESS!!!

THE SOLUTION: The Newly Re-Created System…

The LLC Master-Machine Asset Protection System

Brand New Automated Software Edition by

Albert Aiello - CPA, M.S. Taxation

William Noll - Tax Attorney, CPA - Former Prosecutor and

Criminal Defense Attorney.

26

Both Real Estate Investors with combined experience of 45 years

of tax, legal and real estate > on your team.

A Consummate Asset Protection System…

With Extraordinary Strategies

Covering Every Legal & Tax Component Of A Powerfully-

Structured LLC Shield

With NO Adverse Side Effects

WITHOUT Expensive Lawyers

WITHOUT Over-Complexity

Unlike Any Other Asset Protection Source!

The Most Powerful Documents, Empowering Your LLC To

Be An Impenetrable Fortress Of Asset Protection

The SUPERSTAR Document…

The Master Machine Operating Agreement Extraordinaire

Adaptable for all 50 states and DC specifically targeted for

real estate. It is 121 Pages of Platinum Gold! With Powerful

Protective Legal Provisions saving you from costly time-eating

legal actions.

_ The documents are automatically completed without manual

preparation…simply by filling in a few blanks in a one page “Auto Doc

Input Data Form”, hit “Submit” and the following LLC documents

are instantly & simultaneous generated without doing anything else…

Operating Agreement Extraordinaire (all 121 pages)

Minutes of First Members Meeting

27

Minutes of Annual Members Meeting

Membership Certificates for each Member

Resolutions (14 of them) For Member Authorization of 14

Important LLC Decisions without meetings.

All The Essential Legal Documents To Protect You And Your Family,

Instantly Generated and Completed!,…Without Lawyers!!

It covers everything discussed in this report, except more

in-depth and many more other money-saving gems you will

love.

To join the Webinar, go here:

http://www.creonline.com/webinars/LLC/webinar.html

THANK YOU - AL AIELLO