Do you know why family limited partnerships or a limited liability companies have superior asset protection characteristics to a corporation?
Assume you own stock in a corporation, you are successfully sued, and the creditor obtains a judgment. The creditor can take your stock and assume control of the corporation. Now assume you own an interest in the entity general partner of a well designed and drafted family limited partnership. You are successfully sued, and the creditor obtains a judgment. Now all the creditor could do to your partnership interest is to receive distributions that you would otherwise have received. The creditor may not vote, act as a general partner, or even look at the partnership’s records. A somewhat hollow victory when compared to the loss of your stock.
Related Questions
- Do you know why family limited partnerships or a limited liability companies have superior asset protection characteristics to a corporation?
- How about self directed IRA investments in limited partnerships, limited liability companies, joint ventures, and C Corporations?
- Are Family Limited Partnerships useful in Asset Protection?
