The Three Structures at a Glance
| Risk |
Personal Name |
LLC Only |
Trust Only |
LLC + Trust |
| Tenant lawsuit reaches personal assets |
Yes — full exposure |
No — LLC is separate entity |
Yes — O.C.G.A. § 53-12-82(a)(1) |
No — LLC shields personal assets |
| Probate at death |
Yes — 6–18 months |
Yes — LLC interest goes to probate |
No — trust bypasses probate |
No — trust owns LLC, bypasses probate |
| Property frozen at incapacity |
Yes — conservatorship required |
Yes — no automatic succession |
No — successor trustee steps in |
No — successor trustee controls LLC |
| Each property liability isolated |
No |
Yes — one LLC per property |
No |
Yes — one LLC per property |
| Setup cost |
$0 |
$100 GA filing fee + attorney |
$3,500–$6,000 |
Combined — single engagement |
Holding in Personal Name — Full Exposure on All Three Fronts
Most Georgia investors start here. They buy a rental property, title it in their name, and move on. No formation costs, no paperwork beyond the deed. It is the path of least resistance — and it leaves the investor exposed on every dimension that matters.
At death: Real property titled in the owner’s name requires full Georgia probate administration. The executor earns a statutory commission under O.C.G.A. § 53-6-60 — 2.5% of all cash received plus 2.5% of all cash paid out — plus attorney fees. The process takes 6–18 months in an uncontested case. Major decisions about the property require court involvement during the entire period.
At incapacity: If the owner becomes cognitively impaired, no one can manage, lease, or sell the personally held property without a court-supervised conservatorship. This can take months to establish and costs thousands in legal fees before anyone can collect a rent check.
During ownership: A tenant who wins a personal injury judgment can reach all of the owner’s personal assets — home, savings accounts, vehicles, other properties. There is no entity separating the rental property liability from the owner’s personal estate.
What a Georgia LLC Adds — and What It Does Not Solve
A Georgia LLC formed under O.C.G.A. § 14-11-301 is a separate legal entity. Under O.C.G.A. § 14-11-303, members are not personally liable for the LLC’s obligations solely by reason of being a member. A tenant who wins a judgment against the LLC can reach only the LLC’s assets — not the owner’s home or other properties held in separate entities.
What an LLC does not solve:
Probate. An LLC membership interest is a personal asset. When the owner dies, that interest passes through probate exactly like any other personal property unless a trust or beneficiary designation controls it.
Incapacity. An LLC operating agreement can name a successor manager, but if the operating agreement does not address incapacity clearly, the succession mechanism may not activate without court involvement.
Intra-portfolio isolation. Holding multiple properties in one LLC means a judgment from one property can reach all assets in that LLC. One LLC per property is the standard structure for investors who want intra-portfolio liability separation.
The LLC’s protection is also conditional: Georgia courts pierce the LLC veil under the alter-ego doctrine. Commingling personal and business funds is the primary trigger. An LLC whose rent deposits go into the owner’s personal account is a lawsuit away from losing its liability protection entirely.
What a Revocable Trust Adds — and What It Does Not Solve
A revocable trust avoids probate entirely for all funded assets. Property titled in the trust passes directly to named beneficiaries under the trust terms — no court, no executor, no 6–18 month wait. The successor trustee steps in at incapacity without any court proceeding.
These are the problems the LLC does not solve. The trust solves them completely.
What a revocable trust does not solve: liability protection. Under O.C.G.A. § 53-12-82(a)(1), property held in a revocable trust is subject to claims of the settlor’s creditors during the settlor’s lifetime. A tenant who wins a judgment against an Atlanta landlord can reach trust-held property as if the trust did not exist.
An investor who places all their rental properties in a revocable trust and believes they are protected from tenant lawsuits has solved the wrong problem. They have eliminated probate while leaving every property fully exposed to the liability claims that happen during their lifetime. For a full breakdown of the problems this creates, see Problems With an LLC Without a Trust for Georgia Rental Properties.
Why LLC + Revocable Trust Is the Recommendation for Georgia Investors
The LLC addresses the risks the trust cannot. The trust addresses the risks the LLC cannot. Neither structure alone closes the full gap — the combination does.
The standard structure for a Georgia investor with two or more rental properties:
1
Each property in its own LLC
One LLC per property. Each LLC has its own bank account and operating agreement. A judgment on Property A cannot reach Property B.
2
The revocable trust owns the LLC interests
The trust holds the membership interest in each LLC. At death, LLC interests pass through the trust without probate. At incapacity, the successor trustee steps in as the controlling member of each LLC.
3
The trust does not hold properties directly
The LLC holds the property. The trust holds the LLC. This preserves the LLC’s liability protection — the trust’s ownership of the LLC interest does not compromise the LLC’s separate entity status.
The cost of this structure is higher than either option alone — LLC formation plus a revocable trust engagement. Georgia LLC filing fees are $100 per entity, plus attorney fees for the operating agreement and deed transfer. A revocable trust typically costs $3,500–$6,000 in Georgia depending on complexity. For an investor with three properties, the total structure cost compares favorably to a single probate proceeding — which costs more in executor commissions alone. For pricing details, see How Much Does Estate Planning Cost for a Real Estate Investor in Georgia. For the complete implementation guide, see Estate Planning for Real Estate Investors.
