Some experts suggest that it would be necessary to transfer the house to the LLC name in the title to properly separate it from personal property, however I have doubts that the extra expenses and troubles would make a difference from legal or tax perspective.
Depending on one's specific and explicit situation, the "separation" may very well not be worth it. If your concerns are of being sued by a tenant, increasing one's liability insurance is significantly cheaper and easier in both time and money.
Transferring ownership from your name to the LLC may have more legal implications. So it does require a fair amount of homework - and not just from the tax stand point either.
For example, if you transfer ownership of the property from you to your LLC, the mortgage holder may have a problem with that. Changing ownership without the express written consent of the mortgage holder could put one in direct violation of their mortgage terms, risking the entire mortgage balance payable in full upon demand. This could possibly result in legal foreclosure on the property. There's also a possibility the property insurance could be nullified also. But I do stress that this all depends on the terms of the mortgage agreement, property insurance contract, as well as any state or local laws that may be applicable. So as you can see, there's quite a bit more than just taxes that have to be considered and researched.
Even if you did everything perfect, even a young lawyer will be able to find that "one thing"
A few years back I used to have a bunch of links to county and other web sites that published legal rulings that would support that statement. But after having do so a computer reload some time ago and not having backed up those links, I lost them. At my age, I'm just not going through all that time to find those links again. But if I had them, I'd certainly share them here. But I can say this. In the state of Florida, an LLC is exactly that; a "LIMITED" liability company. From one perspective, it's not the liability that's limited - its the amount of protection an LLC offers that is limited. It may not be as much protection as one may think either. So if that's your concern, increasing the liability portion of the property insurance may be the better way to go. I'm confident it would definitely be cheaper.
