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Why Incorporating Your Business is Essential for Asset Protection #shorts

29 Oct 2024 · 1 min

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A short YouTube video by Bob Gauvreau explaining that incorporating a business can limit a sole owner’s personal liability by keeping business assets separate from personal assets. He describes accumulating assets inside an operating corporation, moving funds into a holding company, and recommends introducing a family trust as part of the structure for further protection.

Chapters

An incorporation can substantially protect you when it's set up properly. So first by setting up a corporation and having the activities of a business run through a corporation it limits the liability and exposure of the individual shareholder who owns the company. People can go after all of your personal assets because you are owning the company all by yourself. Whereas a corporation if that corporation if something were to happen or an accident were to happen and you were to get sued sued, the only assets that they can really go after are the entities assets that corporations assets. So let's say that company is inside a corporation and it starts to be very financially successful. So what happens is if the money is left in the company we continue to accumulate assets inside that company. We can then look at implementing a structure for that corporation which allows you to pull funds out of that operating company and get them into a holding company. My preference would be to introduce a family trust at that point.