Legal Question in Business Law in California

Re: Protecting personal assets

Yes, all of your business risks would be passed. You should look into creating a LLC to protect yourself. Next, insurance. Then, depending on your business, you should consider additional asset protection planning, such as an irrevocable spendthrift trust.

Re: Protecting personal assets

NO! A revocable trust is transparent to creditors; they can attack it just as easily as they can attack assets not held in trust.

An irrevocable trust presents more difficulties for creditors, but still can be attacked. One common method used to attack assets held in an irrevocable trust is to allege in a lawsuit for fraudulent transfer that the assets were transferred to the trust at below fair market value and the purpose was to "defraud, hinder or delay" a creditor or feared future creditor such as someone threatening to sue for money damages.

I do not advise setting up trusts or transferring houses to children, parents or in-laws as a means of protecting assets. Insurance and incorporation are better means. Also, recording a declaration of homestead is of some value.

Re: Protecting personal assets

Not unless it is an unrevocable trust. Contact me directly.

Re: Protecting personal assets

No, your personal assets would be at risk for any liability flowing from your sole proprietor business.

If you are concerned about business liability, you should consider forming an LLC or corporation. This is the first step to protect your assets.