Protecting Your Address is Possible, But Complicated

In the world of property privacy planning, it would be nice if a single solution existed to protect a person and his or her assets from the preying eyes of the rest of the world. Some seek privacy to protect the nature and extent of their financial wealth. Others seek privacy for personal protection. Regrettably, it’s not so simple. There are some strategies to make asset ownership more difficult to uncover, but with each layer of protection comes additional complexity and cost. And, virtually no strategy offers complete privacy protection. 

Let’s focus on a piece of property. You have decided to buy your next home and you want to ensure no one can find where you live.  Without privacy protection, various websites will be able to show your new home’s address. Among those websites are the county assessor’s (or relevant taxing jurisdiction) website and the county auditor’s website (the latter of which is the repository for all deed-related transactions). 

One of the first layers of protection is to look to entity planning – setting up a trust or a limited liability company (LLC) to hold the ownership of the home.  

A trust can be set up to be revocable (able to be changed) or irrevocable (can never be changed). This first layer of protection offers some name protection. By that, I mean that the owner (let’s call him my business partner Matt Riesenweber) would set up a trust in a name that is not at all identified with Matt – call it the “Sunshine Tree Trust.” Now, a cursory view of a county website will reveal the ownership of the property not vested in Matt’s name, but instead vested in the name of the trust. But, a slightly more skilled detective might look at the signatures on the relevant transfer paperwork. Necessarily, someone needed to sign on behalf of the trust. And, whose signature is on the transfer paperwork and all the closing documents? Matt Riesenweber as Trustee of the Sunshine Tree Trust. 

Can we go a step further to provide additional privacy protection with the trust? Perhaps Matt appoints an independent trustee (and realizes the increased cost as trustees generally charge for their services). Now, the signature on the transfer paperwork is signed by hired gun Beau Ruff, Trustee of the Sunshine Tree Trust.  This achieves another potential layer of protection but at an ongoing cost.

But what if Matt required a loan to acquire the property? Matt would have had to apply for the loan in his personal name. Did Matt use a realtor to help him find the property? 

Did he have all associated parties sign non-disclosure agreements to offer legal recourse if they disclose the identity of the property owner? Certainly a cash transaction where an agent (e.g. Beau Ruff) makes all arrangements for the purchase offers more protection, but again it comes at a cost both in terms of money (payment to Beau Ruff) and complexity. 

What about an LLC? With an LLC, Matt would likely have similar problems. Matt might choose to set up an LLC under the name Sunshine Tree LLC. Again, a cursory view of a county website will reveal the ownership of the property not vested in Matt’s name, but instead vested in the name of the LLC. Again, a more skilled detective would now turn to the Secretary of State’s website to look up the governor information for the LLC. In many states (like Washington), an LLC would be required to list the “governors” of the LLC. And, on that website the detective would find Matt’s name. Matt can potentially find a state in which to establish his LLC that does not require the disclosure of the LLC’s members (maybe Delaware) and where he can appoint an independent LLC Manager (again like Beau Ruff) to manage the LLC and be named on all transactions.  

Some simple things can also help – setting up a PO box for mail, for example. A person could also use a friend or family member’s address for many transactions to protect identity. 

We still have a mountain of other potential privacy-thwarting issues to work through—things like: (1) where will you register to vote? Do you have children registered in school to a specific address? Do you hide your identity from your neighbors? How do you hire work to be done at the house by contractors – do they know your identity? 

The rabbit hole of privacy planning can become very deep. It therefore makes sense to have a realistic assessment of the desire for privacy planning, the level of planning to which you are willing to engage, and the cost you are willing to bear. 


* Licensed, not practicing.

The opinions voiced in this material are for general information only and not intended to provide specific advice or recommendations for any individual or entity. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor. 

Securities offered through LPL Financial, Member FINRA/SIPC. Investment Advice offered through Cornerstone Wealth Strategies, Inc., a registered investment advisor and separate entity from LPL Financial.