Which makes the point that, even when the super-rich set up family trusts, they’re not necessarily doing it to minimise tax liablities. It could be, e.g., to protect family wealth against the known or possible improvidence of some members, to protect family wealth in the event of marriage or family breakdown, etc. It could be a combination of different objectives. It could even be that setting up a trust is in some circumstances a net financial loser, but the financial cost is on the settlor is happy to bear to achieve some non-financial objective.
IANAL, but isn’t the point of an LLC to protect your personal assets from the liabilities of the business? Doesn’t exposing a huge chunk of your personal net worth to business liability defeat the purpose of creating an LLC in the first place?
Well, the OP may be contemplating an LLC whose sole activity is the ownership of the residence, so there is no other business activity that might give rise to liablities that could be enforced against the home.
But if you’re talking about an LLC which carries on a substantial business then your point is well made. The whole rationale for creating the LLC is to separate your business affairs and assets and your personal affairs and assets. If you don’t want them separated you can acheive that much more cheaply and effectively by just not creating an LLC in the first place.
Held in trust, i.e. “Sam gets this when he turns 30” or “Sally gets $500 a month from the trust fund” is one thing. A full family trust (what’s the real name?) is like a company/LLC. It owns everything. It allows son and grandson to live in the house it owns, but when the grandson’s gold-digger wife divorces him, of course, she does not get half the house or half the trust fund. In other words, benevolent grandpa “lives on” after death, doling out favours and goodies, but protecting the heirs from their own foolishness.