Yes, you’ve hit on a very popular “sandwich” structure used for privacy and probate avoidance. In legal terms, this is often called a Trust-Owned LLC.
Here is how that specific “sandwich” works:
1. The Structure
- The Bottom Layer (The Stocks): You open a brokerage account (or hold private stock certificates) in the name of your Wyoming LLC.
- The Middle Layer (The LLC): The LLC is the legal owner of the stocks. It provides “asset protection” (if you get sued personally, it’s harder for creditors to grab the stocks inside the LLC).
- The Top Layer (The Living Trust): The Trust is the Member (owner) of the LLC. Instead of you owning the LLC personally, the trust document says, “The [Name] Trust owns 100% of [Name] LLC.”
2. How it Avoids Probate
Because the Trust owns the LLC, and the LLC owns the stocks, the stocks never pass through your personal name at your death.
- You pass away.
- The Trust document immediately points to your Successor Trustee.
- The Successor Trustee now controls the Trust, which in turn controls the LLC, which in turn controls the stocks.
- Result: No court, no judge, and no probate. The “chain of command” stays entirely private.
3. Why People Use This “Sandwich”
- Privacy: In Wyoming, you can use a Registered Agent to keep your name off the LLC’s public filings. Since the Trust (which is also private) owns the LLC, your name is effectively shielded from public view regarding those stock holdings.
- Ease of Management: If you have 20 different stock accounts, you don’t have to move each one into the trust individually. You just make the LLC the owner of everything, and the Trust owns the LLC. It’s one “master switch.”
- Incapacity Planning: If you become ill and can’t manage your stocks, your Successor Trustee can step in and manage the LLC immediately without needing a Power of Attorney or a court-ordered guardianship.
Important Checklist for this Setup:
- The Operating Agreement: You must write an “Operating Agreement” for the LLC that explicitly states the Trust is the owner.
- Assignment of Interest: You have to sign a legal paper (Assignment of Interest) that officially “hands” your membership in the LLC over to the Trust.
- Tax ID: Even though the Trust owns the LLC, for a simple “Revocable” trust, you usually just use your own Social Security number for taxes (this is called a “disregarded entity”). It keeps your taxes simple.
Do you already have the Wyoming LLC formed, or are you looking for the specific wording to use in a Trust document to “link” it to an LLC?