Asset Protection Planning

Ask yourself this question, "What single thing could cause me to lose everything that I have worked my entire life for?" Asset protection planners understand that only one thing can cause you to lose everything and that is the grossly litigious society in which we currently live.

If you have read our asset protection blog, you have seen postings on the 4 year old girl who was sued for negligence, a basketball facility that was forced to close because of a frivolous lawsuit, and a dry cleaner who was sued for over $50 million for allegedly losing a customer's pants. The prospect of contingency fees on large judgments has attorneys everywhere searching out reasons to sue people just like you and me. Our job at Boss is to craft an asset protection plan that will protect your assets from frivolous lawsuits and unexpected liabilities.

It is commonplace for people just like you to say "I am not going to get sued; I don't do anything to hurt anyone." To those folks, an asset protection planner will ask the following questions:

• Do you drive a car?
• Do you own a home?
• Do you own a business?
• Do you have children?
• Do you have rental property?
• Do you have repairmen and other invitees on your property?
• Do you have animals?
• Do you participate in sports?
• Do you borrow money?
• Do you use credit cards?

If you answered yes to any of these questions, then you stand to be sued - you need an asset protection plan.

While almost depressing, it is a fact that on average each of us will be involved in four lawsuits during our lifetime (using the most simple math possible - if you want to get technical, if you are an investor or business, you will likely see more lawsuits). Further, that more than 98% of those lawsuits will be settled out of court in order to avoid the time, money, frustration and uncertainty that bringing a lawsuit to trial creates.

A good asset protection plan will either eliminate these lawsuits entirely or force them into immediate settlements. How?

A good asset protection plan will make it nearly impossible for creditors to reach your assets by moving assets into limited liability entities such as Limited Partnerships (LPs and FLPs) or Limited Liability Companies (LLCs). You can effectively move those assets beyond the reach (or easy reach) of creditors. In fact, you can create a situation where through what's known as a "charging order", your creditor will stand outside your asset protection structure hoping you pay them something and may even end up paying a portion of your taxes.

Maybe even more important is that your asset protection plan - moving your assets into a limited liability entity - you are making yourself appear worthless in the public record. You might ask yourself why you would want to appear worthless to unknown third parties, but the answer is simple:

When someone goes to a plaintiff's attorney in hopes of suing you, that attorney goes through a two-step process. The first step is to ascertain the merit of the case and the likelihood of obtaining a judgment. The second step is to determine whether that judgment can actually be collected or not. Your asset protection plan should make you appear worthless in the public records so no attorney worth their weight would be willing to take the case on.

What better form of asset protection could you ask for than not being sued at all?

Tax Reduction

It is no secret in this country that some business entities enjoy significantly different and potentially more beneficial systems of taxation. Depending on your business activity, the type of entity operating the business will can have a dramatic impact on the amount of tax paid. Choosing the business entity that is right for you is crucial and is another major component to building a proper asset protection plan.

You have probably heard repeatedly that you could save a bundle in taxes by moving your money offshore. You have probably heard that by doing so you will never have to pay taxes again. Wrong! What you have heard are promotions that are illegal and will land you in jail. You are required under federal law to completely disclose all of your offshore holdings and income and pay taxes on them here in the U.S. If you are tempted to go offshore with your planning, make sure your asset protection planner has strong relationships in the jurisdictions where they recommend you form a structure and that they fully explain what can happen in a lawsuit (hint: the court may not have your money, but they have you)...

The better route for everyone is to operate a valid domestic business in the United States. You can reap significant rewards, so there is no reason for 99.9% of companies to go offshore. Instead, a good asset proetction planner will look at the differences in business entities in the various domestic jurisdictions and see if any of the differences will benefit you.

You may have heard that many businesses choose Nevada because of its "business friendly" laws and the absence of a state corporate income tax. You may also have heard that Nevada promotes personal privacy and that many of its entities, including limited partnerships (LPs & FLPs), limited liability companies (LLCs) and corporations are protected by charging order statutes.

If you are interested in these types of benefits, then it may make sense to form a business in Nevada. Call us today to talk to an asset protection planner to learn how strategic entity planning will work for you.

Call 888-969-2677 to start your asset protection plan today.

The law allows you to pay the minimum amount of tax - it does not allow you to evade taxes. Even if the State in which you establish a business does not assess an income tax on the business, this will not impact your responsibility to file and/or pay Federal Taxes.

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