Good afternoon. I really see no reason to put this in an LLC. First, an LLC is not a taxable entity, it flows through to the owners and if the grandmother wants to distribute the additional income to the kids, she can do that directly. There is no additional 15% tax that would accrue. She has a lifetime gift exemption over and above the annual exclusion amount, so there would be no gift tax involved no matter what she does. I simply don't see any thing that is accomplished with the LLC.
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