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Saturday, November 01, 2008
You May Need Two Corporations
After you obtain a
incorporate your business, you have a false
sense of security. You think that
because you incorporated your business, the
corporate structure might protect you assets.
This is correct. Your personal assets
are protected. However, incorporation does not
protect your company assets.
your corporation is subject to lawsuits, and it has
significant assets, such as expensive equipment and
machinery, a judgment against
your company will result in all assets of the
business to be seized as part of the judgment. Your
company will lose machinery, equipment, or any other
item of value.
The solution to this problem is
to begin with two corporations. One will hold all
the assets and lease them to the other one. The
corporation susceptible to lawsuits will maintain
minimal assets and use the leased equipment.
corporation is sued, there will be minimal assets to be
is a trademark and
incorporation attorney that has
helped thousands of small
business owners and entrepreneurs
launch their first business
enterprise. He's also an
entrepreneur who operates several
successful businesses not related to
his law practice.
© E. Stassinos, Esq. 2005. All Rights Reserved.