Changing titles to an LLC

If we are changing from a standard business to an LLC do we need to change title to the LLC on a vehicle that has been previously depreciated out?

Answer

If you want the ownership of the vehicle changed from "a standard business" (I assume you mean a sole proprietorship or partnership), to your LLC, then you will need to change the title.

Remember that the LLC is its own legal entity--like a person. If you want another person to our your vehicle, you need to re-title it.

Same with your LLC.

In terms of the tax effects of re-titling, that's to be discussed with a tax advisor. If it's been fully depreciated, then there's probably little impact (particularly if the vehicle has little or no market value).

You will also want the LLC to hold insurance for the vehicle.

Just as an aside, be sure you have adequate insurance for your vehicle, particularly under-insured motorist and un-insured motorist. With the economy bad (not to mention all the uninsured illegals, depending on where you live), you wouldn't believe how many uninsured people are driving. If one of them puts you in the hospital for a month, and you get a $100,000 medical bill and tens of thousands in lost income, you can recover from your own uninsured policy.

I would recommend a minimum of 100/300 under and uninsured motorists coverage, with 250/500 being preferred. The difference in premiums is small compared to the risk.