Protect Your Assets from Lawsuits (and Taxes)

G.K. Mangelson hears horror stories like this one all the time: An affluent couple hired a professional to paint the interior of their home. The painter built scaffolding to reach the ceiling, but the scaffolding broke. The painter fell, injured himself, and then brought a lawsuit against the couple. “The fact the accident occurred in their home made them liable,” says Mangelson, a senior advisor for the American Society for Asset Protection (ASAP), Las Vegas. 

“The tort system is really weird today,” Mangelson says. “You don’t have to do anything wrong to be wiped out. You just have to be in the wrong place at the wrong time.” During his session Advanced Liability Protection Strategies at COMPOSITES+POLYCON 2009, Mangelson will offer advice to business owners in three key areas: Lawsuit protection, income tax reduction and estate planning. “Anybody who is running a business and has accumulated any kind of equity in their personal lives and in their businesses needs to attend this meeting,” he says.

The path to asset protection begins with proper titling. “One of the most misunderstood concepts is how to title your assets,” Mangelson says. “In other words, we have assets in our personal name or joint ownership, and that’s the worst kind of titling one can have if a person is interested in protection from lawsuits.” He’ll explain the advantages and disadvantages of different business entities and why he thinks LLPs and LLCs are the best.

Business owners often need to form more than one legal entity to protect their assets. Mangelson cites one example in which one partner in a business made a sexual remark to an employee. “Because the other partner was an owner too, the lawsuit included both of them, and they both lost the business,” he says. “You need to be to protect your personal assets, because even though they were both involved in the quagmire professionally, it shouldn’t have affected the one partner’s personal life the way it did.”

This session takes place Thursday, Jan. 15 from 10 a.m. to 10:50 a.m. For more information, click here.