One of our areas of expertise at DeWitt PLLC is using strategies such as creating limited liability companies (LLCs) to manage assets that range from real estate to businesses.
LLCs are advantageous to small business owners who, by separating personal from business assets, can keep their personal savings beyond creditors’ reach. Unfortunately, while these assets may be safe from personal creditors, they are still vulnerable to business creditors.
Getting around this involves structuring the business as two entities. One is an operating company that does not own assets, but possesses them as far as daily operations go. The other is a holding company that owns the business’ assets.
While this multiple-entity approach effectively limits liability, it necessitates a complex funding mechanism encompassing leases, liens, and loans for equity and debt positions. Setting up such a protective framework should be undertaken in consultation with an experienced financial consultant.
About the Author
Founder and managing partner of DeWitt PLLC, Miami-based lawyer Suzanne DeWitt offers cross-border tax-planning services for high-net-worth and institutional clients.