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Originally Posted by Vishnu
I am wondering one thing though. With this structure can the mortgage company take my home since it is owned by the FLP, in the event of an economic collapse? This issue wasn't even in my thoughts when I constructed this program.
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I can't comment on most of what you've described. For many, it sounds like real overkill. If you have nothing IN YOUR NAME, then someone trying to sue you won't get squat unless they can link the company as a party to the action they are suing you for.
Veil piercing normally will not happen just because a company is a sham used to shelter assets. Lots of wealthy people and corporations do that, and the courts have a vested interest in letting that status quo stand.
C-Corp = corporation with pretty much no assets worth mentioning.
FLP = Limited partnership with C-Corp as general partner and all others as LIMITED partners
Everything is either titled or listed on the Schedule A of the FLP.
You have the same problem as any corporation shelter arrangement. If YOU are the cause of someone's injury, they can seek YOUR assets. However, if that injury involves something that is property of the FLP, then its assets can become subject to the claim as well because the FLP can be brought in as a party.
So, you might want a house titled under a new corporation separate from the FLP/C-Corp but subject to control by those entities. This way, if someone got hurt on your property, they can come after you, the LLC/Corp that owns your home, but not the FLP/C-Corp. Have another LLC/Corp for each vehicle, etc.
Save the FLP asset pool for things that are highly unlikely to cause damage to anyone like liquid assets, investments, valuable collectibles, etc.
The trust is just a nice way to ensure there are no hang ups when you die for ALL of the sheltered assets going to where you want them to go.
For the interest of protecting both assets and privacy, you often need layer after layer of corporate identities to layer veils between a potential creditor and the assets to be protected.
Just my 2 cents....I'm educated, but no expert.