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Note: You can now set up
your own LLC in Calif. Go to Products on the left.
Just about every financially successful person needs asset protection. Here
are a few illustrations that might apply to you:
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Licensed professionals
face constant exposure to malpractice lawsuits since statutes of limitations
for bringing these actions often begin when the client discovers the
problem - which can be decades after the service was provided. Insurance
long past retirement is needed, but beyond that, these policies often
have exclusions that may render them of little value. These professionals,
therefore, need to shelter their personal assets apart from the business
in which they provide their professional services.
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Business owners
and directors are common targets of claims by customers, suppliers,
employees, lenders and business competitors, and often these claims
extend to government agencies such as the IRS, EDD or Worker's Compensation.
These business owners, therefore, need to insulate their personal
assets from these liability-producing businesses, even if the business
is a corporation.
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Anyone who owns
rental real estate is a magnet for lawsuits and a high degree of frivolous
claims. Exposure to this owner is can be great given the possibility
of serious injury to tenants, their guests and workers along with
ever-increasing liability for toxic problem lawsuits involving mold
or other hazards. Insurance is a must but catastrophes can exceed
limits and toxic liability is often excluded from coverage. These
owners need asset protection to limit their liability to the value
of the single property.
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Real-estate developers
face potential liability for latent defects for as long as 10 years
after the project has been completed. And, given the risky nature
of real estate development, one project can easily wipe out the gains
from others unless liability separation is put in place through asset
protection.
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Any professional
could exceed their professional liability limits under their insurance
policy, or experience full liability if their carrier goes out of
business.
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Even those not
falling within the above risk groups should seriously consider some
level of asset protection. Any driver could have auto accident which
might involve damages exceeding their insurance coverage, and be in
jeopardy of losing their personal assets.
- Anyone with assets in excess of the current estate tax exemption
needs asset protection to reduce the value of their assets for
estate taxation purposes. This is achieved through the use of
irrevocable trusts, family limited partnerships and limited liability
companies. (For 2007, this exemption is two million dollars)
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Finally, for many
of us, the value of the equity in our homes will exceed our estate
tax exemptions by the time we die. Our homes need to receive asset
protection in order to reduce their value for estate tax purposes.
One extremely important side benefit of home asset protection is that
our nests become sheltered from creditors, thereby giving us the peace
of mind that we will never lose our homes.
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