Once a New Yorker owns more than the apartment they live in — a rental property, a family house meant to pass to children, a building held with partners — the question is no longer only what to buy, but how to hold it. Title can sit in an individual's name, in a trust, or in a limited liability company, and the three are not interchangeable. Each is built for a different purpose, and choosing among them is really a decision about what the owner is trying to protect.
There is no single right way to hold real property, because the forms do different work. Holding in an individual's own name is the simplest and the default, but it exposes the property to the owner's personal creditors and sends it through probate at death. A revocable living trust keeps the property out of probate and provides for management if the owner becomes incapacitated, without changing who controls or is taxed on it. A limited liability company separates the property's liabilities from the owner's other assets, can hold ownership among several people under a written agreement, and keeps the owner's name off the public record. The question is never which form is best in the abstract; it is which one fits this property and this owner's goal.
This article sets the three side by side — what each accomplishes, what each costs, and the traps that catch owners who move property into a trust or an entity without reading the consequences first. It is written for the owner of a home, a second property, or an investment building who is weighing how to hold it, and for the family thinking past the purchase to how the property will be managed, protected, and eventually passed on. The recurring theme is that title is a planning decision, not a filing formality, and it is best made with the estate plan in view rather than after it.
It is general information about New York law, not legal advice on any particular property, and the right structure depends on the specifics — the kind of property, the mortgage on it, the owner's other assets and obligations, and the owner's own tax and family situation. The statutes and thresholds here are described in general terms and as the law stands in 2026, and they change. Retitling property has tax, lender, and insurance consequences that should be confirmed by counsel against the actual facts before anything is signed or recorded, and reading or relying on this article does not create an attorney-client relationship.
Three ways to hold title, three different jobs
Real property in New York can be held in an individual's name, in a trust, or in an entity such as a limited liability company, and each answers a different question. Individual ownership answers none of them: it is the default a deed takes when nothing else is arranged, and while it is simple and cheap, it leaves the property fully exposed to the owner's personal creditors and destined for probate — the court-supervised process of settling an estate — when the owner dies. For a modest primary residence that will pass to a spouse, that may be acceptable. For anything more, the owner usually wants one of the other two forms, chosen for what it is designed to do.
A revocable living trust and a limited liability company solve different problems and should not be confused. A revocable trust is an estate-planning instrument: it keeps property out of probate and lets a successor trustee manage it if the owner is incapacitated, but the owner keeps full control and remains the owner for tax and creditor purposes, so it offers no liability protection. An LLC is a liability instrument: it walls the property's risks off from the owner's other assets and can hold ownership among partners or family members, but it carries costs and formalities a residence rarely justifies. Matching the form to the goal — probate avoidance, liability separation, privacy, or shared ownership — is the whole of the decision.
Title is a planning decision, not a filing formality — chosen for what the owner is trying to protect.
The revocable living trust — probate avoided, control kept
A revocable living trust is a document the owner creates during life, transfers the property into, and continues to control as trustee. Its central benefit is that property titled in the trust does not pass through probate: on the owner's death it moves to the named beneficiaries under the trust's terms, privately and without a court proceeding, which in New York can save months and expense and keeps the disposition out of the public record. The trust also names a successor trustee who can manage the property without a guardianship if the owner becomes unable to, which is often the quieter reason to use one.
What a revocable trust does not do is as important as what it does. Because the owner keeps the power to revoke it and take the property back, the law still treats the owner as the owner: the property remains reachable by the owner's creditors, remains part of the owner's taxable estate, and provides no protection against a future need for Medicaid. The compensating advantage is that nothing changes for tax purposes — the owner keeps the capital-gains exclusion on a primary residence under Internal Revenue Code § 121 and the STAR real-property tax benefit, because for those purposes the owner is still treated as owning the home. Transferring a mortgaged home into a revocable trust in which the borrower remains a beneficiary is also protected from due-on-sale acceleration by the federal Garn-St. Germain Act, 12 U.S.C. § 1701j-3(d)(8), so the mortgage is not disturbed.
The LLC — liability separated, name off the record
A limited liability company is the tool for property held as an investment or with other people. Titling a rental building or a co-owned property in an LLC separates that property's liabilities — a tenant's injury, a contractor's claim — from the owner's home, savings, and other holdings, so a judgment against the property generally reaches the property and not everything else the owner has. The LLC also holds multiple owners under a written operating agreement that sets who manages, who is paid, and how interests transfer, and it keeps the individual owners' names off the publicly recorded deed, which owners who value privacy often want.
The LLC carries New York-specific costs a buyer should know before forming one. New York's LLC Law § 206 requires a newly formed LLC to publish notice of its formation in two newspapers for six consecutive weeks and file a certificate of publication — a requirement that, in the downstate counties, can cost more than forming the company itself, and one many owners are surprised by. New York does not offer the series LLC available in some states, so each property that needs true separation generally needs its own company. And contributing mortgaged property to an LLC can trigger New York transfer tax on the debt the entity takes on, unless the transfer qualifies as a mere change in the form of ownership — a point to confirm before deeding property in, not after.
New York's LLC publication requirement under LLC Law § 206 can cost more than forming the company itself — a surprise worth pricing in advance.
The traps of moving a home into an entity
The most common and most expensive mistake is putting a personal residence into an LLC in the belief that it adds protection. For a home the owner lives in, it usually subtracts. The owner remains personally liable for injuries the owner causes, so the liability shield is thin; meanwhile the transfer can forfeit the Internal Revenue Code § 121 capital-gains exclusion, because an LLC is not an individual living in the home; it can cost the STAR exemption for the same reason; it can void or complicate a homeowner's insurance policy written for an owner-occupant; and it can trip the mortgage's due-on-sale clause, which the Garn-St. Germain protection for revocable trusts does not extend to entities. A residence generally belongs in the owner's name or a revocable trust, not an LLC.
Even where an entity or trust is the right destination, the mechanics of getting there have their own costs. Retitling is a conveyance, so it should be checked against New York transfer tax and, on a refinance, the mortgage recording tax under Tax Law § 253; the title insurance policy should be endorsed to cover the new owner, since a policy insures the party named in it; and any lender's consent should be obtained rather than assumed. Moving property is not a clerical act — it is a transaction with tax, lender, insurance, and title consequences, and each should be confirmed before the deed is recorded.
Matching the structure to the goal — and to the estate plan
The decision comes back to the goal. A primary residence the owner wants kept out of probate and manageable in incapacity usually belongs in a revocable living trust. An investment or rental property, or one held with partners, usually belongs in an LLC, where the liability is contained and where interests in the company — rather than fractions of a deed — can be given to children over time as part of a considered gifting plan. Property the owner wants to protect from future creditors or from the cost of long-term care is a different problem again, calling for an irrevocable trust, which trades the owner's control for protection the revocable forms cannot give; the companion article on protecting the family home in New York elder law takes up that path.
This is where holding title becomes part of the estate plan rather than a step taken before it. How a property is held determines how it passes at death, whether it avoids probate, whether it can be given down a generation efficiently, and whether it is exposed to a creditor or a care cost the family did not plan for. Those are estate-planning questions answered at the moment title is chosen, which is why the choice is best made with the whole plan in view. The firm advises on holding real property and on the estate plan it belongs to together, so that the form of ownership serves the owner's intentions rather than working against them.
How a property is held determines how it passes — which is why the choice of title belongs inside the estate plan, not before it.
Common questions
- Should I put my house in an LLC?
- Usually not, if it is the home you live in. An LLC does little to protect an owner-occupant — you remain personally liable for your own conduct — while the transfer can cost the capital-gains exclusion under IRC § 121, cost the STAR exemption, complicate your homeowner's insurance, and trip your mortgage's due-on-sale clause. A home you occupy generally belongs in your own name or a revocable trust. LLCs are for investment and co-owned property, where the liability separation and shared-ownership terms actually earn their cost.
- Does a revocable trust protect my property from creditors or Medicaid?
- No. Because you keep the power to revoke the trust and take the property back, the law still treats the property as yours, so it remains reachable by your creditors and counts against you for Medicaid. A revocable trust's benefits are probate avoidance and management if you become incapacitated — not asset protection. Protecting property from creditors or long-term-care costs requires an irrevocable trust, which trades your control for that protection, and is a separate decision to weigh with counsel.
- What is the New York LLC publication requirement?
- New York's LLC Law § 206 requires a newly formed LLC to publish notice of its formation in two newspapers designated by the county clerk, once a week for six weeks, and then file a certificate of publication. In the downstate counties the newspaper cost can exceed the cost of forming the company. It is a real and often-unexpected expense, and it is one reason to decide whether an LLC is the right tool before forming one for each property.