Legal Question in Business Law in Massachusetts

Re: How many corporations?

The general rule regarding asset protection is segregate & insulate each asset with a separate business entity with limited liability protection. The other general rule of asset proection is never mix 'hot' assets with 'cold' assets. The specific answer to your question depends upon a myriad of other facts. Please feel free to contact me direct for a free initial consult based upon the facts of your specific situation;))))

Re: How many corporations?

Compartmentalization is ordinarily done when there is some likelihood that a liability is going to somehow arise that would not only overwhelm the assets related to it but also attach to other unrelated assets. Thus, traditionally, taxi cab companies have put each medallion and cab into a separate entity to contain the potential liability (in excess of insurance) that could arise out of an accident, and shield all of the other cabs and medallions.

The kinds of investment activities that you describe in your query do not suggest the use of multiple corporations. Indeed, unless there is some reason to expect a risk of upstream liability, I question the need for a corporation (or other entity) at all.

Please ask any further specific questions if you have them. Best wishes,

LDWG