Start Your Own Corporation Quotes

“So do not worry about asset protection being unaffordable.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“unlike a corporation, real estate, intellectual property as well as stocks and bonds in a brokerage account can be transferred in and out of an LLC at their basis, thus incurring no taxation.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“On the other hand, transferring the house out of an LLC is not a taxable event.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“LLCs are favored for asset-holding entities.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“When shareholders receive distributions from a corporation the transaction is taxed.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“The series LLC is supposedly designed so that by setting up (and paying the fees on) one asset-protected LLC you can protect a number of properties in separate series within the one LLC.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“That argument worked until the state of California decided that each series would be taxed as a separate LLC. So instead of paying just $800 for one series LLC in California you would pay, in our four-asset example, $3,200 for the series—the same as if you’d used four separate LLCs with greater certainty of protection.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“By using separate LLCs we have the certainty that assets in a remote LLC will not be exposed to claims brought against a target LLC. The series LLC does not offer such certainty.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“you don’t want a lot of assets in one LLC (or LP). An LLC that holds ten properties is a much bigger target than ten LLCs each holding one property. In the first case, a fall at one property exposes the other nine properties to attack.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“you may want to have your California entities, for example, owned by Nevada or Wyoming LLCs, which specifically offer protection on single member LLCs.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“(It should be noted that under California, New York and several other states’s law Chalmer could force a sale of Teo’s fourplex. This is why you want to use Nevada and Wyoming LLCs in certain states with weak asset protection laws.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“When holding an asset, as a general rule you will be better protected using an LLC instead of a corporation.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“Their LLC has good credit and is able to borrow $600,000 without the need for personal guarantees. The loan has the effect of increasing each owner’s tax basis by $200,000. Because distributions are taxed only when they exceed an owner’s basis, this means that Lisa, Lyn and Lovella can each receive $200,000 in profit distributions tax free from the LLC.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“In an LLC, the members get the benefits of business debt,”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“In an S corporation you can pay yourself a reasonable salary, on which you pay payroll taxes. Profits after salary can be flowed through to the owner without payroll taxes. (Please note that an LLC can elect to be taxed as an S corporation and achieve this benefit.)”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“Brendan makes $200,000 a year in his pool cleaning business. As a single-member LLC, he would pay over $18,000 in payroll taxes on the entire $200,000 profit. If Brendan used an S corporation and paid himself a $72,000 a year salary and flowed the rest through as profits without payroll taxes, his payroll taxes would be $11,000 per year. As such, Brendan could save $7,000 a year, year in and year out, by using an S corporation over an LLC. Who says choice of entity isn’t important?”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“States require that a resident agent be designated.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“On top of that, from a big picture perspective,”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“they used a mix of Nevada and Wyoming entities to hold the LLCs formed in the states where the property was located.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“(But what is known is that California courts tend to do what they want.)”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“if you are doing business in California, then California law applies no matter where the entity was formed.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“If the LLC was formed under California law, the attacker would have the ability to pierce through the LLC and force a sale of the buildings.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“if an LLC had not been used the result would have been much worse.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“Do not be swayed by glowing testimonials and fancy brochures.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“Consider having the operating entities hold fewer assets and lease expensive assets from the asset-owning entities.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“Keep the operating entities—the ones that deal with the public—away from the asset-owning entities.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“Please also feel free to read this case a few times as it may take a while to sink in.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“but wanted it protected.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“Assume Your State, Inc. is involved in a day-to-day business where it could be sued. By having all the good assets in Wyoming, Inc., and leasing them to Your State, Inc., you have removed these assets from risk.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them

“What does California think of this? They will assert that the Wyoming business is doing business in California and thus must pay all state taxes, including the notorious $800 annual franchise fee. If you live in California know that you will have to do a lot more planning (and may have to pay more in state taxes) when using these strategies.”
― Garrett Sutton, Start Your Own Corporation: Why the Rich Own Their Own Companies and Everyone Else Works for Them