A Rochester asset protection attorney helps people to keep their wealth safe. Everyone needs to make certain they have been proactive about protecting their money and assets because there are always risks and you work too hard to lose what you have built. However, those who are most vulnerable to loss must be especially careful to make a solid asset protection plan so they don’t find themselves without the financial security they tried to create for themselves.
Small business owners, in particular, need to make certain they have an asset protection plan in place. The owners of small businesses face several different kinds of risks of potential loss that most people do not need to worry about planning for. A Rochester asset protection attorney at The Law Office of Michael Robinson, P.C. can assist those small business owners in making smart choices to mitigate the danger of potential loss and to protect hard-earned money and property. Give us a call to find out more about how our legal team can help.
Why Asset Protection is Important for Small Business Owners
Asset protection is important for small business owners both because there are risks to personal wealth associated with running a business and because a small business owner could lose the company or business assets if no plan is made for business succession.
When you run your own business, the company could be seen as a part of your own identity unless you have created a separate business entity distinct from yourself. For example, if you operate as a sole proprietor, there is no legal distinction between you and the company. This means if your company gets into debt and the company has to file bankruptcy, it won’t be possible for the company to go bankrupt unless you personally go bankrupt.
Your assets are at considerable risk when you start a business, both because many businesses fail and your company – and by extension you – could be left with debts and also because your company could be sued and you could become liable for the judgement against the organization. If someone sues you because they claim they were injured on your property, you could find your personal wealth in jeopardy if you haven’t separated the business from yourself. This type of risk can be avoided through incorporation or the creation of another appropriate business entity that can limit your liability.
There is also a risk that you won’t be able to pass your business on to your loved ones if you haven’t made plans to protect the company and your ownership interest in it. When you pass on, your estate could end up owing estate tax. The problem is, many business owners have the bulk of their estates invested within a business and there may not be cash or other liquid assets available to pay for the taxes that are triggered by a death. There could be few options other than selling the company, heirs or beneficiaries taking a loan to pay taxes, or selling some company assets.
The potential for loss due to estate tax after death is only one of many ways that the company’s value could be lost due to your death. If you pass on and the company you own doesn’t transfer quickly to new owners because the asset transfer cannot occur until after a lengthy probate process, there could be a long period of uncertainty over who is in charge or even a long period of mismanagement. The result of this could be that the company loses value or even ends up discontinuing operations because of damage done by a lengthy and uncertain delay in the new owners taking control.
There are ways to avoid potential loss of the value of your business, but you should work with an experienced attorney to make certain you understand the options available to you.
Getting Help from A Rochester Asset Protection Attorney
A Rochester asset protection attorney offers personalized help to small business owners and to others who face potential loss and who want to minimize and mitigate risks. To find out more about the ways in which we can help you to keep both your company and your personal assets safe and secure, join us for a free seminar. You can also give us a call at 585-374-5210 or contact us online to get personalized advice on your own specific financial and professional situation. Call now to learn how we can assist you.
- How Estate Planning for a Family May Trap the Unwary Practitioner - August 31, 2022
- State Income Taxation of Social Security Benefits - August 24, 2022
- Understanding Tax Apportionment Clauses - August 17, 2022