The firm Kevin Wessell built in the past helped small business owners and others to form various kinds of businesses by filing all the necessary documents with the appropriate offices in each of the 50 states and several foreign countries. Now semi-retired and devoting most of his time to charitable activities, Kevin Wessell also built his reputation teaching audiences nationwide how to protect their assets from all manner of hazards, including creditors, tax collectors, frivolous lawsuits, and even the probate process.
In his book Insider’s Guide to Asset Protection, Kevin Wessell explains the many threats against which average Americans must defend their resources. For example, politicians never tire of expounding on how valuable and important small businesses are, and it’s a known fact that more Americans work for small businesses than for large corporations. No matter how good those businesses are, though, many find themselves involved in litigation sooner or later. If they aren’t incorporated and they lose a lawsuit, not only could the business go under, the owner of the business is also personally liable. Thus, if an unincorporated business worth $100,000 loses a $200,000 lawsuit, the owner is on the hook for the extra $100,000.
Of course, different circumstances call for different approaches to asset protection. When two or more people go into business together, it often makes more sense to establish legal protections by setting up a limited partnership instead of a corporation. Other approaches include the limited liability company (LLC) and the limited liability limited partnership, or LLLP.
In addition to protecting assets, these approaches can also generate significant tax savings, and can be structured to protect the assets of the affluent. According to Wessel, the late Sam Walton, founder of Wal-Mart Stores Inc., transferred the assets of his business into a closely held family corporation early in his career. In addition to protecting those assets on a daily basis, the move reportedly saved his estate nearly $10 billion in estate taxes when he died.