If you have a business or profession it needs to be organized and maintained. The business is part of your estate whether you own all of it or a part and therefore is clearly part of your Estate Planning.
Because we at Eastham Law Offices concentrate on Estate Planning and Asset Protection along with Probate and Trust Administration, we are extremely knowledgeable and qualified to advise our clients in regard to the proper organization for their business.
Our first step in reviewing a business that is up and running is to see whether or not it is operating under the proper business entity. After that determination we will inquire as to whether the books and records are being properly maintained, including the up to date filings with the government. The analysis of an ongoing business in Estate Planning and Asset Protection planning may result in suggested changes that will help our client avoid personal liability and loss of business assets for non business obligations.
Common business entities are:
- Sole Proprietorships
- General Partnerships
- Limited Partnerships
- Professional Association
- Limited Liability Companies
A. Sole Proprietorships
A business that operates under its owner’s name is called a sole proprietorship and is rarely if ever recommended. It offers no asset protection for the owner’s personal assets if someone or some entity has a claim against the business or the owner.
A popular business entity is a corporation, which if properly organized and maintained can prevent personal liability of stockholders which own the corporation for corporate obligations. A claim against a stockholder for a non corporation debt can result in the loss of the stockholder’s stock which represents his or her ownership interest.
C. Limited Liability Company
A popular business entity is a Limited Liability Company or an LLC as they are commonly known. An LLC doesn’t have stockholders. It has members and if properly drafted and maintained can provide very good asset protection for its members in connection with their personal assets. The LLC has experienced changes in Florida law and any LLC formed without proper legal advice will most likely not provide the benefits of asset protection.
D. Family Limited Partnerships
Another business entity used in Estate Planning and Asset Protection is the Family Limited Partnership which in our opinion is the best and most proven entity to protect assets of our clients. When properly drafted and maintained it can and has provided many of our clients with protection of their assets from future creditors, unnecessary taxes, divorce and in many cases the loss of assets due to a long term health issue and the tremendous expense of a nursing home.
E. General Partnerships
A General Partnership is simply two or more individuals operating a business and like the Sole Proprietorships is rarely if ever recommended. It too offers no asset protection for the owner’s personal assets if someone or some entity has a claim against the business or the owners.
F. Professional Association
Professional Association is essentially the same as a corporate but is reserved for professionals such as doctors, lawyers, and certified public accountants (CPA).
If you have any concerns in regard to a current business or plans involving the starting of a business, please call us for consultation. Remember the Attorneys at Eastham Law Offices primarily do all of representation based upon flat fees. In other words, you will know the cost of of our services in regard to your business entity before engaging us.
Contact us by phone or email for all of your Estate Planning and Asset Protection needs.