A partner and I are buying a multi-unit on good seller financing terms on a Contract for Deed (Land Contract) in Minnesota, where we’re both residents, using an LLC as Trustee. His single-member LLC and my single-member LLC (neither is the same as the Trustee LLC, don’t worry) will be beneficiaries.
Seems like an efficient way to set up a de facto Partnership without the hassle of actually creating a new entity. Since bank accounts want EINs or SSNs to open an account and we want a separate account just for this property, what’s the best way to open a bank account? Seems like it we’d want to use the EIN of the Trustee LLC, or is there another way?
probably should consider adopting a formal partnership agreement to head off any disagreements down the road, even if it is “just” a handshake partnership.
exit strategy, right of first refusal, transfer on death, removal of partners, that sort of stuff.
always a pain to be dealing with a hostile ex-wife who now owns half of half of his LLC in trust for the minor children who refuses to pay for the new roof and wants all the cash…you get the idea.
You will need a solid partnership/operating agreement for the LLC that will act as trustee and that needs its own EIN and accounts. Using other accounts is a sign of co-mingling and will undo what you are trying to do.