The Corporation is probably the tool you are most familiar with, yet most people do not take full advantage of the protection it can offer. This strategy and accompanying document has 57 indexed pages and covers both the 'C' and 'S' Corporation.
USE A CORPORATION: If you are in business, and 1) Have one or more employees, or 2) Do business, of any nature, with another person or business. In other words, ALWAYS!
USE A CORPORATION TO PROVIDE:
1. Lawsuit Protection . . .
The 'C' Corporation and 'S' Corporation offer the same degree of liability protection. The 'C' Corporation offers more tax deductions. The 'S' Corporation allows you to pass income and losses through to your personal return without the corporation tax. Create an empty "shell" for your operating entities.
2. Income Tax Reduction . . . There are far more tax deductions available to the 'C' Corporation than any other form of operation. Consider linking the 'C' Corporation with an 'S' Corporation and with a Family Limited Partnership to provide income tax reduction, inheritance tax reduction and additional lawsuit protection. Tie all the strategies together on the personal level in the Revocable Living Trust.
3. Estate Tax Planning . . . Future company appreciation attaches to stock ownership. If you use the Corporation for estate tax planning, be sure the Corporation is not an operating entity with high lawsuit risk.
HOW AND WHERE AND WHO:
1. Use a Nevada Corporation -- there is no officer or director liability.
2. Make all corporations a one person corporation. Make yourself the only officer and the only director. Do not subject others, unnecessarily, to liability.
3. Have the Corporation Act as an operating entity shell. Do not have any assets in the operating corporation, lease them all! Even "lease" your ideas to the operating entity shell.
4. You must act and look like a corporation to be protected. That means hold meetings, document all actions in writing. The Corporation becomes your alter ego--write it down. Do it right if you want protection.
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