Robertson Law Group "Your Wills, Trusts, and Asset Protection Law Firm"
Robertson Law Group "Growing & Protecting Your Wealth"
Asset Protection & Piercing the Corporate Veil
Asset Protection & Piercing the Corporate Veil
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Asset Protection
Asset protection is a legal strategy designed to shelter your assets from lawsuits and to discourage lawsuits from being filed against you. Proper asset protection is not fraud because it should be done in advance of any lawsuits or contemplated lawsuits or judgments.
Corporations
Generally, corporations are separate entities from their business owners and shelter the business owner's personal assets from liabilities of the business. Unfortunately, many business owners have learned the hard way that the liability structure of a corporate is flawed at best. I personally do not recommend that anybody should be a shareholder in their Corporation in their personal name nor operate a business as a manager in your personal name.
A creditor will sue your Corporation and every shareholder as individuals. The goal of the plaintiff's attorney is to force you either into a settlement or gain access to your assets. If the creditor is able to prove that you improperly handled your Corporation's finances such as commingled your business and personal funds, your personal assets are exposed.
If you are a shareholder in a LLC or Corporation's name, the creditor must pierce two different business entities and not just one. Hence, your chances of winning are greater and your leverage to win a favorable settlement has increased.
What happens When a Lawsuit is Filed and You Own Your House in Your Personal Name or Jointly with Your Spouse?
I highly recommend that you neither own your personal residence in your personal name only nor as tenants in common or joint tenancy with your spouse. As a business owner, you face a strong liklihood of lawsuits and one lawsuit could force you into selling or foreclosing your jointly owned home. In many jurisdictions, tenancy by entirety is a way of owning your personal residence as husband and wife. Tenancy by entirety shelters one's spouse lawsuit from forcing a foreclosure or sell of your personal residence. For example, Amy and John are husband and wife and John has recently had a lawsuit filed against him. Amy and John should own their house prior to the lawsuit as tenancy by entirety. The benefit of tenancy by entirety is the lawsuit/judgment against John will not affect the property ownership of Amy and John. If Amy and John owed the property in a different manner, John's judgment could force Amy and John to auction their home to satisfy John's judgment.
Robertson Law Group, LLC
Serving Cook, Dupage, & Will Counties
312-498-6080 or RobertsonLawGroup@gmail.com
www.robertsonlawgroup.com
Asset protection is a legal strategy designed to shelter your assets from lawsuits and to discourage lawsuits from being filed against you. Proper asset protection is not fraud because it should be done in advance of any lawsuits or contemplated lawsuits or judgments.
Corporations
Generally, corporations are separate entities from their business owners and shelter the business owner's personal assets from liabilities of the business. Unfortunately, many business owners have learned the hard way that the liability structure of a corporate is flawed at best. I personally do not recommend that anybody should be a shareholder in their Corporation in their personal name nor operate a business as a manager in your personal name.
A creditor will sue your Corporation and every shareholder as individuals. The goal of the plaintiff's attorney is to force you either into a settlement or gain access to your assets. If the creditor is able to prove that you improperly handled your Corporation's finances such as commingled your business and personal funds, your personal assets are exposed.
If you are a shareholder in a LLC or Corporation's name, the creditor must pierce two different business entities and not just one. Hence, your chances of winning are greater and your leverage to win a favorable settlement has increased.
What happens When a Lawsuit is Filed and You Own Your House in Your Personal Name or Jointly with Your Spouse?
I highly recommend that you neither own your personal residence in your personal name only nor as tenants in common or joint tenancy with your spouse. As a business owner, you face a strong liklihood of lawsuits and one lawsuit could force you into selling or foreclosing your jointly owned home. In many jurisdictions, tenancy by entirety is a way of owning your personal residence as husband and wife. Tenancy by entirety shelters one's spouse lawsuit from forcing a foreclosure or sell of your personal residence. For example, Amy and John are husband and wife and John has recently had a lawsuit filed against him. Amy and John should own their house prior to the lawsuit as tenancy by entirety. The benefit of tenancy by entirety is the lawsuit/judgment against John will not affect the property ownership of Amy and John. If Amy and John owed the property in a different manner, John's judgment could force Amy and John to auction their home to satisfy John's judgment.
Robertson Law Group, LLC
Serving Cook, Dupage, & Will Counties
312-498-6080 or RobertsonLawGroup@gmail.com
www.robertsonlawgroup.com
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