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When transferring property into a limited liability company (LLC), it's crucial to avoid using a quit claim deed. The common mistake many make is opting for this type of deed, which does not provide warranties and fails to effectively transfer ownership. Quit claim deeds indicate to third parties that the individual behind the business structure is still linked to the property, even if their name isn't on the deed. In contrast, when purchasing property, a warranty deed is typically received, ensuring proper ownership transfer. Essentially, using a quit claim deed can create confusion about ownership and liabilities, limiting who will accept the deed in transactions.
