Legal Question in Credit and Debt Law in Pennsylvania

Will Incorporating Protect My Assets?

If I incorporate a sole proprietorship and then transfer any assets into the corporation, will they be protected against a judgment for personal credit card debt? Conversely, if I transfer assets into someone else's name before the judgment is rendered, will the assets be protected? I have been advised bankruptcy is not an option immediately because I am going through a divorce and I have business assets I cannot afford to lose in order to make a living.


Asked on 2/17/04, 10:24 am

1 Answer from Attorneys
Gerald Hershenson Law Office of Gerald M. Hershenson

Re: Will Incorporating Protect My Assets?

There are many questions that you raised. I suggest you meet and discuss these issues with legal counsel. If you transfer assets to a corporate entity, a creditor may file a legal action to set aside the conveyence. However, the matter is far too complicated to advise you in this medium. On its face the transfer would intially protect the assets from a levy. Assets owned by a sole proprietorship is subject to a levy, while a corporation is not. However, I urge you to speak with legal counsel.

Gerald Hershenson Esq. 215-579-9390

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Answered on 2/17/04, 10:46 am


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