Why Form A Corporate Entity?

DO YOU REALLY THINK THAT YOU HAVE NOTHING TO HIDE?

THINK AGAIN

THE BEST WAY TO AVOID BEING AN EASY TARGET FOR A LAWSUIT, IS TO NEVER MAINTAIN RECOVERABLE ASSETS IN PLAIN SIGHT. [1] [2]

THE HOW & WHY –

We live in an extremely litigious society. The chances of one of us becoming the target of a lawsuit is extremely high. Americans have a 1-in-4 chance of having a potentially devastating lawsuit filed against them. [3]

ASSET PRIVACY & PROTECTION –

Keep your wealth as insulated as you possibly can for privacy and asset protection. Even though most private arrangements are offshore, you can achieve a surprising degree of financial privacy and protection by properly configuring your domestic assets.

THE BEST REASON TO FORM A CORPORATE ENTITY IS TO AVOID BEING AN EASY TARGET FOR A LAWSUIT –

Much like a burglar sizes up potential targets to burglarize, looking for residences that are unlocked, unprotected (no bullet-proof vest or alarm system); or those that are unoccupied (no one at home); litigation seeks out the weak and unprotected. Simply put – an easy target. The process is a simple risk/reward analysis.

The world of litigation is no different (attorneys are just a slightly higher caliber thief). They look for easy targets, or at a minimum, targets that present with a high potential for reward. Again – a risk/cost/reward analysis.

When lawyers size you up to determine whether or not to file a lawsuit on behalf of a prospective client, the most important thing that they want to discover is – whether you have recoverable assets? Simply put, “Am I going to get rewarded/paid for my efforts to prosecute a lawsuit against this individual?

IN VIRTUALLY ALL CASES –  NO RECOVERABLE ASSETS TRANSLATES TO NO LAWSUIT FILED.

This is especially true if the litigation involves a contingency based fee (paid only out of the proceeds recovered from the target of the proposed litigation, and only if the litigation is successful).


[1] LEGAL DISCLAIMER: This FAQ article contains general legal information and does not contain legal advice. Lucas Lucas, LLC is not a law firm ,nor is it a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please seek competent legal advice (ask a lawyer).

Nothing contained herein should be deemed or construed to be legal advice. Lucas Lucas, LLC is not a law firm and does not provide legal advice. For that reason, nothing contained herein is intended to take the place of sound legal and financial counsel. The subject matter contained herein is presented strictly for informational purposes only. After considering the subject matter contained herein, it is always best to seek sage legal and financial advice prior to undertaking asset protection strategies.

[2] John D. Rockefeller once said: “Own Nothing, Control Everything

[3] There are currently between 80 and 90 million lawsuits filed in this country each year. That is over 150 lawsuits per minute. Over 70% of the world’s lawyers reside right here in the USA; and we are adding new lawyers at a rate of 50,000 per year.

Unfortunately there is no way to completely avoid the possibility of being sued. There is, however, a way to reduce the risk of a devastating lawsuit; and to protect yourself should a lawsuit be filed against you. What you need to do is to arrange your affairs so that any activity that could create the potential for a lawsuit is transacted in a manner that will not affect your personal assets. Whether the activity is an operating business, rental property, high profile poker wealth, or any other “risk” operation, you need to separate yourself from those operations through corporate entities (Corporation, Limited Liability Company, Limited Partnership, Trust or some combination thereof).

If you do not own anything, or if it appears that you do not own anything, no lawyer will sue you unless someone is willing to pay their exorbitant hourly fees and roll the dice. If, on the other hand, the lawyer discovers substantial assets, he may very well take the case against you on a contingency basis. Attorney’s contingency fees in the US currently run in excess of 10 billion dollars per year.

Ever wonder why most legal firm names are followed by PS, PLLP, LLP, LLC or something similar? Lawyers know how to protect themselves and their assets. You can, and should do the same.

The best way to protect your personal assets in our highly litigious society, is to form a legal entity that is separate and distinct from yourself (a virtual bullet-proof vest). This legal entity can be in the form of a Corporation, Limited Liability Company, Limited Partnership, Trust, or some combination thereof. Be mindful of the fact that, in order for a corporate entity to provide the protection you seek, it must be properly set up and operated. Additionally, the corporate entity type must fit your particular circumstance. When set up and operated properly, your corporate entity will not only provide the protection you seek (a virtual bullet-proof vest), it will pay for itself many times over in the form of fringe benefits and tax savings. It is the best insurance that you will ever purchase – bar none.

LEGAL DISCLAIMER: Lucas Lucas, LLC is not a law firm; nor is it a substitute for an attorney or a law firm. The law is complex and changes often. The subject matter contained herein provides general information and it is presented strictly for educational and informational purposes only. It is not intended to take the place of sound legal advice. For legal advice, please seek competent legal counsel (ask or engage a lawyer/attorney). Nothing contained herein should be deemed or construed to be legal advice, or take the place of sound legal and financial counsel. After considering the products offered and/or the subject matter contained herein, it is always best to seek sage legal and financial advice prior to undertaking any asset protection strategy.

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Posted in: Lucas Lucas LLC™