Pro Asset Protection

Attorney Ike Devji

  • Articles
  • Contact
  • Facts and FAQ’s
  • Asset Protection Attorney Ike Devji – Bio
  • Home
  • Off the Record
  • Reputation and Recognition

LLC Sales Myths Harm Doctors, Business Owners: Asset Protection

July 21, 2015 by Ike Devji, Asset Protection Lawyer Leave a Comment

LLC USAGE - PHYSICIANS PRACTICE
It is important for every doctor and business owner to understand some basics about the Limited Liability Company, commonly known as an LLC; what it is, how it is created, and some of the benefits a well-drafted and maintained LLC can provide.
Unfortunately I regularly get reports from my own clients that have been at medical seminars and hosted financial dinners where dangerous myths and misinformation, already popular among laypeople are being reinforced. The level of this misinformation ranges from incompetence to outright fraud in the very worst cases.
Much of this information is disseminated by non-attorney promoters, who don’t provide legal counsel or advice but “document preparation,” with no professional oversight or liability — leaving the  client holding the bag and on his own when things go wrong. Even using a law firm is not a guarantee of good advice unless the attorneys are qualified and experienced in this area of the law, so make sure you have good help.

Here are a few important distinctions to be aware of:

1. No LLC is “secret,” but they can be “private”
If you see the word “secret” used in any LLC marketing or advertising be very careful. Despite what physicians are being told, there is no such thing as secret in legal and financial planning; what you are doing is only secret until you are asked about under oath, under penalty of perjury. Secrecy is never part of any competent asset protection plan and basically provides you with a plan no more sophisticated than trying to hide assets and hoping no one ever asks you if you did so. Nevada LLC promoters in particular are notorious for this, but it’s not unique to Nevada, several states offer similar “private registration” including New Mexico, Delaware, and Wyoming. All this really means is that some states like those listed above require a lower level of disclosure about who the members (owners) of an LLC are in their public records. As such, they are considered more “private” which never hurts, and frankly is something I myself do for doctors and business owners who want privacy with the very explicit admonition that there is no real increase in the asset protection value of such a structure, and that it will be fully discoverable in any kind of legal proceeding. There are a variety of very legal, ethical, and legitimate reasons why you might want privacy, including wanting to keep your nonmedical (and possibly controversial) business and investment activities private, keeping a low profile  to avoid being perceived as a financial target, and simply to avoid jealousy and resentment about your success among patients or clients and even your staff and colleagues, to name just a few.

 

2. Using a “private” LLC usually won’t provide a tax benefit

Another common marketing ploy is the general statement that using a Nevada (or similar) state LLC will reduce your tax liability. While this may be true for those who actually live and operate in one of these LLC friendly states that have tax benefits, it is often not the case for those living in one state and registering their LLC in a different state.

EXAMPLE:  California resident Dr. Jones created a Nevada LLC that owns her California rental homes, but still pays all applicable California taxes and fees, and in some cases additional fees to register as a “foreign corporation” doing business in her state. Add to that questions about conflicts of law and the recurring annual costs of having a registered agent for service of process in the state where the LLC was registered and the benefits promised start to erode quickly.

3. A word on divorce

Among the most egregious promises I’ve seen made by scam artists is a blanket statement that LLCs “help in divorce.” Putting assets that are already community property or marital property, including income earned during the marriage or an investment made with marital assets, into an LLC your spouse does not have an interest in will not help you in a divorce, in fact it may adversely affect you if it seen to be fraudulent, theft, conversion, or concealment. Using a properly drafted LLC may however be one good device for keeping what is legitimately separate property legally distinct.

This article was originally published in a different form at www.PhysiciansPractice.com, The Nation’s Leading Medical Practice Management Resource. The author, Ike Devji is an Asset Protection attorney with over a decade of experience in helping to protect thousands of HNW clients from a variety of risks and has written over 200 articles on related issues.

Share this:

  • Click to share on Facebook (Opens in new window)
  • Click to share on Twitter (Opens in new window)
  • Click to share on LinkedIn (Opens in new window)
  • Click to share on Pinterest (Opens in new window)
  • Click to share on Reddit (Opens in new window)
  • Click to share on Tumblr (Opens in new window)

Filed Under: Arizona Asset Protection, Asset Protection, Asset Protection for Doctors, Asset Protection Fraud and Failures, asset protection law, asset protection strategies, Business Owners, dentists, Limited Liability Companies, LLC Asset Protection, LLC Myths Tagged With: Asset Protection, asset protection lawyer, Creditor Protection, Ike Devji, lawsuits, Limited Liability Company, llc, Physicians Practice

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

See Ike’s Work In Action

· Ike Devji on Acrimoney.com
· Ike Devji on CFO ADVISORS
· Ike Devji on Infosec Island
· Ike Devji on Risk and Threat Management

Money Matters Interview

Recent Posts

  • The Business Roundtable Podcast: Asset Protection
  • The Risks of Doing Business With Family Members
  • Campaign Contributions: What Business Owners Need to Know
  • Recession Asset Protection – Is My Bank Safe?
  • Asset Protection for Pain Management Doctors and Anesthesiologists

Categories

  • 2012 Economy (3)
  • 2013 Economy (3)
  • 2020 Recession (1)
  • 529 and College Savings Plans (1)
  • abusive tax schemes (13)
  • APT (3)
  • Arizona (19)
  • arizona anti-deficiency statutes (5)
  • Arizona Asset Protection (33)
  • arizona bankruptcy (4)
  • arizona economy (13)
  • Arizona Estate Planning (11)
  • arizona forclosure (8)
  • arizona real esate (12)
  • Asset Protection (174)
  • Asset Protection Education (16)
  • Asset Protection for Doctors (36)
  • Asset Protection for Your Home (7)
  • Asset Protection Fraud and Failures (22)
  • asset protection law (25)
  • asset protection strategies (42)
  • asset protection trusts (33)
  • Baby Boomers (5)
  • Banking and Bank Solvency (5)
  • Bankruptcy (8)
  • Best Money Market rates (1)
  • brokers (1)
  • Business Asset Protection (3)
  • business law (3)
  • business legal planning (72)
  • business owner and entrepreneur (15)
  • Business Owners (28)
  • business survival (48)
  • business valuation (6)
  • buy sell agreement (5)
  • captive insurance company (8)
  • Cars and Automobile Liability (4)
  • Cash Alernatives (2)
  • CEO (27)
  • children (8)
  • chiropractors (35)
  • CIO (1)
  • closely held business (30)
  • commercial real estate (8)
  • Coronavirus (2)
  • cpa (20)
  • creditor negotiation (4)
  • creditor protected cash alternatives (5)
  • Crisis Management Planning (7)
  • CTO (1)
  • DAPT (3)
  • debt (4)
  • deficiency judgment (2)
  • defined benefit plans (2)
  • dentists (57)
  • Director and Officer Liability (10)
  • disability insurance (2)
  • Divorce (5)
  • doctor sued (44)
  • Doctors (54)
  • Domestic Asset Protection Trusts (2)
  • Due Dilligence (11)
  • economy (9)
  • employee social media usage (3)
  • Employment law (25)
  • Entrepreneurs (5)
  • equity (1)
  • ESTATE MANAGEMENT (2)
  • estate planning (29)
  • estate tax (12)
  • estate taxes (3)
  • Expatriation (1)
  • face book (3)
  • family business (19)
  • Family Legal Planning (7)
  • family liability (11)
  • family limited partnership (4)
  • Family Office (8)
  • FAMILY OFFICE ISSUES (6)
  • FDIC Insurance Limits (2)
  • finacial advisors (7)
  • Finance (12)
  • financial advisors (23)
  • FINANCIAL ISSUES FOR DOCTORS (47)
  • financial literacy (56)
  • financing (6)
  • firearms (5)
  • forclosure (2)
  • foreclosure (3)
  • foreign bank accounts (7)
  • fraud (18)
  • fraudulent conveyance (3)
  • funding (3)
  • Geri Custer (1)
  • gifting (1)
  • Gifting – Wealth Transfer (4)
  • Greg George (5)
  • GTI ADVISORS (5)
  • Gun trusts (1)
  • guns (7)
  • HEALTH CARE LAW (6)
  • high net worth (17)
  • HIPPA violations (1)
  • homeowner's liability (13)
  • HR (3)
  • IAPT (2)
  • id theft (4)
  • Ike Devji (100)
  • Ike Devji – Asset Protection Expert (5)
  • ILIT (2)
  • information security (5)
  • intangible assets (3)
  • intellectual property (1)
  • investing (12)
  • investment exposure (14)
  • IRA creditor protection (1)
  • IRA Trusts (1)
  • Irrevocable Life Insurance Trust (3)
  • IRS (7)
  • Jeff Christenson (4)
  • Jumbo CD Rates (1)
  • kids (6)
  • lawsuit awards (23)
  • lawyers (8)
  • Leadership & Management (12)
  • leading wealth and legal advisors (2)
  • legal documents and records (3)
  • Legal Strategies (19)
  • liability (46)
  • liability insurance (35)
  • Life Insurance (13)
  • life Insurance conversions (1)
  • LIFE INSURANCE CREDITOR PROTECTION (2)
  • Life Insurnace Conversions (2)
  • Limited Liability Companies (2)
  • Limited Partnerships and FLPs (1)
  • linkedIn (1)
  • LLC Asset Protection (3)
  • LLC Myths (2)
  • Loan default (4)
  • Lotzer Law Group (1)
  • malpractice (14)
  • malpractice insurance (2)
  • marketing and reputataion management (2)
  • Marriage and Family (2)
  • Medical Marijuana (1)
  • Medical Practice Management (23)
  • medical practice mangement (31)
  • Medical Practice Risk Management (14)
  • mexican real estate (1)
  • Mortgage (1)
  • Municipal Bonds (2)
  • Nevada (1)
  • offshore (16)
  • offshore banking (9)
  • offshore trusts (13)
  • parenting (7)
  • partnerships (2)
  • personal finance (2)
  • personal injury (8)
  • personal security (9)
  • physicians (41)
  • physicians personal finance (3)
  • privacy and identity (2)
  • professional athletes (27)
  • professional entertainers (17)
  • property insurance (7)
  • rachel weiss (5)
  • Raisng Capital and Funding Your Business (1)
  • real estate investing (14)
  • recession (12)
  • recession lawsuits (13)
  • recession survival (32)
  • Reputation and Recognition (1)
  • reputation management (1)
  • Retirement Plan Creditor Protection (2)
  • retirement plan funding (2)
  • Richard Arnold (1)
  • risk management (11)
  • scams (13)
  • Scottsdale (1)
  • Sean Shepherd (3)
  • SEC (1)
  • secret bank accounts (6)
  • SECURITY (5)
  • shelf corporations (1)
  • small business (3)
  • social media (5)
  • start-ups (7)
  • startup (5)
  • Strategic Default (4)
  • Succession and Transition Planning (5)
  • Surgeons and Surgical Centers (5)
  • tax deductions (19)
  • tax fraud (7)
  • taxation (17)
  • taxes (23)
  • THE VAULT (2)
  • Trisha Lotzer (1)
  • trusts (4)
  • twitter (1)
  • Uncategorized (52)
  • up front fees (1)
  • Urgent Care Centers (1)
  • vacant real estate liability (4)
  • venture capital (6)
  • wealth transfer (5)
  • Wealth Transfer Strategies (13)
  • women & money (8)
  • Workplace Violence (2)
  • worth magazine (4)

Copyright © 2021 · Dynamik-Gen on Genesis Framework · WordPress · Log in