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Certain types of condo buyers have been hiding behind LLC's and investment trusts for a long time in New York City. A celebrity-studded NY Times real estate story parses the LLC demo this weekend, including:
- Celebrities who don't want their addresses made public to paparazzi and other stalkers
- Wall Street types, publicly scorned for wealth accumulation, "more eager than ever to keep their multimillion dollar real estate deals away from prying eyes"
- Money launderers and people getting divorced
- Wealthy folks seeking asset protection from a slip-and-fall suit by a member of the household staff or a guest
The Times story didn't mention another reason for which even ordinary mortals may be tempted to dive behind an LLC: The creepily invasive website Blockshopper.com. (Check out the Manhattan edition here.)
Blockshopper's minions scour public records and websites liked LinkedIn to gin up "news" stories about regular people (such as your gynecologist, your boss, you) and intimate details about their real estate.
These "news" articles inform anyone who Googles your name (such as your prospective boss kicking around salary figures, your contractor preparing a bid, the preschool admissions director, your crazy ex-) how much you just paid for your two bedroom apartment, its precise address and square footage, what you do for a living, where you were born, and what your partner does for a living, where s/he went to school, etc.
It's sort of like an involuntary NY Times wedding profile, only it happens when you marry an apartment.
Of course, as the Times points out, besides renting, there's really no way to win the privacy battle: If you don't use your given name to purchase a home, you'll lose out on the capital gains deduction when you sell--currently capped at $250,000 for singles and $500,000 for couples.