Small business owners know morethan anyone about the realities of bankruptcy, either in the form ornear-misses or through personal experience. Consequently, no one needs toprotect their assets quite as thoroughly or understand bankruptcy like a smallbusiness owner.
If you cannot imagine and bearthe consequences of a personal bankruptcy then perhaps you should not start abusiness. Such was the advice in a recent Forbesarticle titled â€œHow To Bounce Back From Bankruptcy & TheLoss Of Your Home.â€
There original article offerssome practical steps to help understand the mechanics of bankruptcy â€“ such aswho, what, where, why, when and how â€“ but the most important things tounderstand are the exemptions.
Certain aspects of your personalfinancial life are legally protected under state laws, even in the face of somany liabilities and debts. You should plan accordingly.
For example, most states offer ahomestead exemption from bankruptcy that will save your home from liquidationto creditors, unless of course you have mortgaged the home. There are otherways to lose the homestead protection that are less obvious, too.
Knowing your protections canenable you to structure your business and operations to protect your interests,and indeed there is much that can be done. At the most basic level, even thechoice of form for your business (Limited Liability Company, Corporation, etc.)can have important ramifications to understand.
Regardless, the time to makeplans to protect your personal assets from your business liabilities is now,rather than later.
At IdahoEstate Planning we are the expertsyou need to know and trust. Work with us and we'll put together a plan thatworks for you and your loved ones. Remember, goodplanning is no accident.