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Asset Protection for Professionals and Business Owners
in California

Serving Tustin, Irvine and Santa Ana, California, and the Surrounding Areas


Asset protection planning involves making prudent decisions today to protect yourself, your business, and your hard-earned assets from loss due to lawsuits, creditors or bankruptcies. This type of legal planning is especially prudent for professionals and business owners, whose personal assets could be at risk due the nature of their employment.

Statistically and anecdotally, we all know that the number of divorces, lawsuits and bankruptcies is staggering. While no one believes lightning will strike them, wealth created through a lifetime of work, saving and investing can be lost overnight if these forms of man-made lightning do strike. To protect your assets from such disaster, proper risk management strategies should be given careful consideration. These strategies include exempting your assets from the claims of creditors, limiting your liability through legal entities, and transferring your risk through insurance.

Exempting Assets in California

State and federal laws exempt some of your assets from the claims of creditors. Click here to download a listing of California's exempt assets; note that while some states allow you to choose either the state or federal exemptions, in California you must use the state exemptions and federal bankruptcy exemptions are not available.

Once you have identified the protected asset classes available to you under applicable law, it may be prudent to maximize your protection by converting non-exempt assets into exempt assets.

Limiting Liability for Professionals & Business Owners

Many entrepreneurs operate their businesses as sole proprietors rather than through a legal entity, such as a Corporation or a Limited Liability Company. Whether their business is home-based or in the Fortune 500, these business owners are attracted by the informality of sole proprietorship. They also do not want to incur legal fees to create and maintain a legal entity. However, in addition to other advantages, conducting business through a legal entity may offer substantial risk management benefits.

While lawsuits brought against a sole proprietorship are really lawsuits against the owner's personal assets, lawsuits against a properly created and maintained legal entity are really lawsuits against the entity's assets. Nevertheless, the selection of an appropriate legal entity is critical for managing your risk.

Transferring Risk with Insurance

When was the last time you reviewed the details of your liability insurance program with your insurance professionals? Are your policies current? Are the coverage limits adequate and are the deductibles reasonable? Have you scrutinized the policies for loopholes? Remember: the fundamental philosophy of any insurance coverage is to pay a premium you can afford to transfer a risk you cannot afford. Take time to understand both the risks you have retained and the risks you have transferred.

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A qualified team of estate & business planning attorneys at MRJ&C is waiting to serve you! The MRJ&C team can simplify your life planning with fundamental estate planning, wills & trusts, powers of attorney, Medical Directives and documents, probate & estate administration, planning for minors children, special needs and disability planning and trusts, estate plans for blended families, estate planning for same-sex couples and LGBT planning, estate tax planning and minimizing, business transfer and succession planning, small business planning in general, and asset protection and limiting liability. MRJ&C serves clients all throughout Orange County, including (but not limited too) Tustin, Irvine, Santa Ana, Ahaheim, Newport Beach, Aliso Viejo, Mission Viejo, Huntington Beach, Costa Mesa and Lake Forest, California.

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Paula Clarkson, Attorney | (714) 972-2333 | info@mrjcestateplanning.com | 1551 N. Tustin Avenue Suite 1020, Santa Ana, CA 92705
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