QUESTION
What type of business entity can be established that has no financial liabilties because of the person who started it?
Asked on Jun 26th, 2012 on Business Law - Texas
More details to this question:
I am looking to start a corporation, a functioning business; however, I do not want the business to be a target of any potential financial liabilites I am face in the future. For example, if I were to divorce I would want the business (and business assets) to be protected/off limits. Likewise, if a lawsuit were to be filed against me (say for a car accient), I would want the business/business assets protected.
What type of structure would this be, and how would one go about establishing this?
1 ANSWER
Reviews not shown
1 Award
There is no practical way for you to have ownership, enjoyment and control of this entity and still have it be "off limits" for the claims of your creditors. You could, in theory, place the business in a so-called "asset protection trust"; but, if you do so, you would have to give up all rights to control, or to sell and receive the benefits of, the business.
Answered on Jun 27th, 2012 at 9:55 AM