1) No tax 2) no need

1) No CGT

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Passive-Activity-Loss-ATG-Chapter-5-Dispositions

"A mere change in the form of ownership is not a qualifying disposition. An entity is not necessarily an activity. The conversion by the taxpayer of a business or rental activity from a sole proprietorship to an LLC or S Corporation in which the taxpayer still owns an interest is not a qualifying disposition, which triggers current and suspended losses. "

2) No need title insurance, just do a quitclaim deed.