Asset Protection for the Business Owner | Legally Mine

Many small business owners underestimate the possibility of a lawsuit as well as the measures they could take to prevent one. Our professional consultants at Legally Mine will help you develop a plan to protect your assets.

To get started, knowing what types of claims you might face and which assets are most at risk will benefit you before implementing a strategy. Legally Mine will make sure you know what all your asset protection options are and help you to create a personalized plan that suits your specific business needs.

Internal Claims vs. External Claims

Internal claims will only affect the assets belonging to the company. For example, an injury that occurs on company property or with company equipment can only lead to loss of that property, equipment, or other assets owned by the company. An internal claim runs under the assumption that you personally were not responsible for the accident.

 However, if you are operating the equipment or you own the property, an external claim may be filed. An external claim holds you personally accountable and your personal assets are now at risk as well. Your Legally Mine consultant can answer any questions you may have about internal and external claims and advise you on how to keep them safe.

What is a Dangerous Asset?

Dangerous assets are those that have the potential to cause a problem. Real property, machinery and equipment, and company vehicles are all dangerous assets because they present a liability risk.

Safe assets are generally monetary rather than tangible. Assets like stocks, bonds, and personally-owned bank accounts are considered safe assets, as they can not cause problems on their own.

How Can I Protect My Assets?

The first step in protecting your assets is to set up a meeting with Legally Mine to go over your finances and expectations. Legally Mine will educate you on the benefits and drawbacks of each asset protection option as it relates to you. A solid protection plan will include ways for you to maintain control of your assets without direct ownership, thus reducing the risk of personal loss in a lawsuit. Some of your options may include forming a C Corporation, S Corporation, Limited Liability Company, Partnership or Trust.

• C Corporation - Individuals and the corporation are both taxed separately in a double taxation. This option allows for profits to be reinvested into the company at a lower corporate tax rate.
• S Corporation - A company with fewer than 100 shareholders can be taxed as a partnership while still gaining the benefits of a corporation. This way double taxation is avoided.
• Limited Liability Company - This option combines the benefits of a corporation and a partnership and allows members of the company freedom from liability.
• Partnership - A General Partnership is an agreement between two people where both parties are responsible for all asset liability and is not usually recommended. A Limited Partnership includes both general and limited partners, allowing limited partners to not be personally responsible for the debts of the partnership.
• Trust - In a trust, a grantor is responsible for holding onto the assets for another party and distributing them to the trustee as agreed upon.

When choosing a firm to assist you in organizing and protecting your assets, keep in mind that many law firms do not specialize in asset protection. Legally Mine has over 40 years of experience helping medical and business professionals protect their personal and business assets. Because asset protection is all we do, we have attracted a large volume of clients, which allows us to charge less than standard competing attorneys. As your business grows, we’ll continue to advise you on the best asset protection plans and make adjustments as needed.