Asset Protection Services in Danville
Do You or Your Danville Business Need an Experienced Asset Protection Attorney?
JGPC business lawyers are attorneys specializing in helping business owners, managers, investors, buyers, and their businesses in every stage of the business life cycle. We have decades of experience in assisting privately held businesses and business owners with the legal issues related to all stages of business growth.
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Our Danville Asset Protection Services
The Five Levels of Asset Protection:
Level 1 asset protection is the use of business entities. Everyone engaged in a business or professional practice should consult an experienced business attorney to consider the formation of an asset protection entity, such as a corporation, LLC, LLP or LP, to help protect both the business assets placed in the entity and owner’s non-business assets owned outside of the business entity.
The creation of one or more entities such as an S Corporation, a C Corporation, a Limited liability Company (LLC), a Limited Partnership (LP), a Limited Liability Partnership (LLP), a Family Limited Liability Company (FLC) (FLIC), a Family Limited Partnership (FLP) (FLIP), an Asset Protection Trust and other types of entities are important steps in creating an asset protection strategy. The asset protection shields created by formation of these entities can offer some protection to both the assets “inside” the entity and the owner’s personal assets held “outside” the entity.
Entity asset protection can be classified as “inside-out asset protection” or “outside-in asset protection”.
Inside-out asset protection is the protection a business owner’s personally owned assets receive from claims against a business entity that provides an asset protection shield. Inside-out asset protection prevents a third party creditor who sues and gets a judgment against the business entity from reaching the owner’s assets held outside of the entity. For example, in most situations, a third party creditor who gets a judgment against a corporation or an LLC cannot go after the owner’s assets that are not owned by the corporation or LLC. That is, a claim against an entity such as a corporation, cannot reach an asset “outside” the entity, such as a house held in the name of the shareholder. Corporations and LLCs provide similar levels of “inside-out” asset protection.
Outside-in asset protection is the protection received by an entity’s assets from claims against an owner of the entity, such as a corporation, an LLC, or another type of business entity that provides an asset protection shield. Outside-in asset protection prevents a third party creditor who sues and gets a judgment against the owner of the business entity from getting to the assets “inside” the entity, that is, the assets owned by the entity. In fact, in many situations, LLCs can provide better “outside-in asset protection” than can corporations.
Level 2 asset protection is basic estate planning that everyone should have. These types of entities and powers include: wills, revocable living trusts, durable powers of attorney, heath care powers, and special needs trusts. JGPC Law does not provide level two services, but we’re happy to provide you with referrals to competent estate planners who specialize in this area of practice.
Level 3 asset protection involves taking advantage of exemptions & appropriate marital planning. Assets placed in exempt or protected status are protected from creditor attacks and are exempt in bankruptcy proceedings. Such exemptions might include use of homestead exemptions, insurance, annuities, pension plans, and retirement plans. Some states also have special exemptions such as the home exemptions provided in Florida and Texas, or the self-settled trusts allowed in many states. Such planning might also involve transfer (commutation) of vulnerable community assets into the separate ownership of a non-working spouse.
Level 4 asset protection involves the use of entities such as LLCs, LPs, FLICs, FLIPs, foreign or domestic asset protection trusts, QPERTS and other entities for protection of personally owned assets. Level Four asset protection involves the use of domestic or foreign asset protection trusts. Many states now authorize the use of “self-settled trusts” that can be used to protect assets from creditor claims. Many foreign nations authorize use of protective asset protection trusts.
Level 5 asset protection involves the use of dynasty and heritage entities to protect and preserve family assets over generations. Entities such as Family Limited Liability Companies (FLCs) (FLICs) or Family Limited Partnerships (FLPs) (FLIPs) can be used to protect and preserve family assets over time. These entities may also provide significant estate tax savings and minimize the impact of gift and estate taxes on the transfer of assets to future generations.