Alex Murdaugh's Trial: Asset Protection | Lawyers Reacts

Welcome, ladies and gentlemen, to the live today with best selling author, America's small business tax lawyer, real estate investor and YouTube personality Mark J. Kohler with a special episode today.

Well, thank you. Special episode. Woo. Excited to be here. Mark Kohler regularly talking about tax, business, wealth building and asset protection. Which brings us to Alex Murdaugh. Now, I'm not trying to just get on the bandwagon of a interesting, salacious, exciting topic. I mean, who wouldn't? But actually I have literally have a published, bestselling book on asset asset protection and here's my most recent book on asset protection as well. Got several chapters dedicated to that and I've written prolifically about O.J. simpson. Now some of you that are younger may think, oh cool, football player guilty of murder or something like that. It's a very controversial topic as well. But O.J. simpson is still alive and well with a lot of his assets, even after a very long and rigorous criminal case that he was acquitted of killing Ronald Goldman and Nicole Brown Simpson, but but then found under civil liability, 33.5 million. I can't, I always get 34 million, 35 million mixed up there. You know, what's a mil there? And he's kept the majority of his assets. And the civil case that followed O.J. simpson after the criminal case was pretty big deal back then. And now we've got Alex Murdoch found guilty this week of killing his wife and son Paul. And very sad, very tragic, everything that's gone in that county, the Netflix special is crazy. But there's now 92 or more civil cases piling up of people that he's defrauded along the way, stolen money from the list goes on and on. Of all the travesties, there's, and there probably could be even a claim from the estate of his wife Maggie's through here, her parents possibly and I mean, it just gets really complicated. So we're going to talk about his assets, what we know, what we don't know. I've been watching some interviews with the attorney John T. Lay, the court appointed civil attorney by the court to liquidate gather all of the assets of Alex Murdaugh and then distribute them, according to the court, as these cases are decided and quote unquote settled. So it's really interesting and there's a lot to learn for all of us on protecting our assets. Now, I can almost guarantee that none of you as myself want to be caught in the crosshairs of a case like this. And it is just man. Now, new allegations of sexual misconduct as well, and just the list, it's. They start to pile up. I've got my reporter in the field. I just called her before, before the show, too, to like, okay, give me the update. What's the new ones today? I mean, just every day something crazy. So I, I better just even shut my laptop here before they just, you know, continue to pop up on my screen. But here's the deal in the O.J. simpson case, as well as what we're going to see in the Murdoch case, is that all of us have asset protection with certain assets where unless we're in a divorce or the IRS wants the money, no one's going to touch it. I mean, isn't that crazy? I mean, O.J. simpson, $33.5 million judgment, Ronald Goldman's parents, parents and Nicole Brown Simpson's dad brought the suit. And just as recently as this past year reported, they've only received 1% of the judgment that they received years ago. Even that's after O.J. simpson published a book, you know, if I Did it, OJ Simpson has been able to keep his pension, his quote, unquote, 401k from the NFL, and his home and real estate connected to his primary residence in Florida under the homestead exemption. So this is really telling because all of us need to know, what is the rule in our state for how I can protect the equity in my home? And number two, understand how protected our retirement accounts and IRAs and investments are. Some are protected under ERISA. And what's the Employment Retirement Securities Income act that I think I even butchered that. Apologize. I've got a lot of acronyms and laws going through my head as I prepared for this. But under erisa, our retirement accounts are protected. But if I have a bank account with just cash in it and I get in a car accident, texting and driving, they're going to get that bank account. In most states. They're also going to be able to get at my home. They could get at my rental properties. And some of you go, well, I'm set up an LLC to protect my rental property, aren't I? Good. No. Most of the time, the LLC is there to protect you from the tenant, but not protect the home from you being an idiot. And so asset protection is a very, very complicated topic. So I want to break it down a little further. I want to take your questions from on asset protection on your trifecta, setting up your structure to build wealth and protect it. And it may be very enlightening to you on what your options may be in your state. My executive assistant too. Could you go grab my calendar? I publish a calendar every year. I pull from my book the Tax Legal Playbook from the appendice in there and update it each year on the homestead exemptions by each state. And here we go. Thank you very much. And so I'm going to go to my calendar here and use this as a resource to also look at. I've got all sorts of tables here. Which states offer the best asset protection, which states have crappy asset protection. We're going to bust into that. I'm also going to pull from my book the appendices here on homestead exemptions. And you got. So anyway, lots to talk about here. And so I'm not trying to sensationalize or, you know, I guess, gosh, compliment O.J. simpson or Alex Murdoch for asset protection. It's really sad the people that are left in the wake of these terrible actions and crimes people commit. But I want to throw out this principle first and then we'll get into a little detail and then I'll take your questions and we can talk about business and wealth building protection for you. Let's make sure we learn from this when we talk about your issues. But here's the deal. It may really piss off some of you that O.J. simpson or Alex Murdaugh or how many other quote unquote criminals around the country get away with terrible, terrible things. And the victims in the wake of these issues try to go get compensated, get some of the assets they may deserve for pain and suffering and they go after them and come to find out in that state, you can't get at the equity in their home or you can't touch their IRA or you can't touch their 401k. And I'm going to give you some numbers here on what's going on in Murdoch's situation. And that may make you really mad. But what if it was you on the other side? Maybe you were innocent and framed, maybe you have a retirement account that's for your family and you were a bad actor. But you don't want that retirement account to go to someone else. You want it to go to your family. And is it fair that they're hurt by the actions of you and your retirement account taken and given to someone else? You may be feel differently about it. And this is what's hard about Miranda rights and the death penalty and punishment in when it comes to crime, it's always, you're all, we're always mad when someone gets off or gets this you know, light punishment. But then sometimes you may have a family member or yourself on the other side of the aisle and you're like, oh my gosh, that there's, there's other issues here. This isn't fair. I want protection. And so kind of the rain falls on all of us. Bad things happen to good people, good things happen to bad people. And it's, it's tough. So don't get too up. I mean, just, hey, don't send me hate mail. Don't hate the player, just hate the game. I'm just here, explain the rules of the game. All right, so here's some interesting numbers. This is again, how much can you verify? If I'm not John T. Lay, the court appointed attorney, he's the only one with the inside scoop on the real value of these assets. But estimates are around 2.1 to 2.2 million in Alex Murdaugh's retirement account. That would be his 401 and approximately 350 to 400 grand in his IRA. Now those are going to be really hard to touch and the 401k will really almost be untouchable. The IRA. I don't have my table on IRAs by state, but the IRA in some states can only, will sometimes only be protected up to 100 grand or 250 grand. And someone single versus married. So the IRA might be a little more accessible to a creditor. He also is the member of Several multi member LLCs. And so in that situation, they're already talking about are we going to force the liquidation of these LLCs? Because that affects other owners of the LLCs. And that's where we get into these charging order protection issues. And that's a type of LLC that doesn't allow me to go in and force someone to sell everything in their LLC because there's other members to the llc. It's not fair to them. So you, I might have to step into Alex Murdoch's shoes and own part of that llc, but it doesn't mean I can force him to sell everything either. Now we get into South Carolina where he was found guilty and where his home that he transferred to his wife back in 2016. This is another little factoid. Back in 2016 he transferred the home for $5 to his wife. Maybe he saw some of this coming down the pipe, I don't know. But it is an automatic homestead exemption from creditors in this in South Carolina. It's kind of a weird number. $116,510. So that would be protected for the Family estate from creditors, anything above that a creditor could get. But he transferred it to his wife, who's now passed away due to him, according to the jury of his peers. And so it was interesting that he transferred to his wife for $5 for love and affection. That was on the transfer, which. Okay, anybody. That love and affection didn't get her too much in the long run anyway. I gotta be careful what I say here. So it's just a travesty. It's so sad. And so I don't want to again be too comical. I'm known to try to keep things light. And this is a very heavy topic. So anyway, if you have a question about your state or a question about your asset protection, I'm all yours. Let's kind of beat this up. But with LLCs, between $601 million with other members to the LLCs, an IRA with maybe 400 grand, a retirement with a couple million, there's a good chance any creditors may not be able to get at those assets. Now, any other transfers or money in the bank or other things, that's what this court appointed attorney is going to try to do, is get gather all of that, take all the creditors and put them in line based on who has senior claims when their claim came in the door and then get this pool of money and start divvying it out. And it gets to be very complicated on who gets what when. But I'd rather be number one in line than number 92. That's obvious, right, everybody? Okay, can we go to the whiteboard? Let me just kind of show a quick diagram of what we do for clients when we're meeting with a client that's saying, hey, I'm not out planning to kill anybody, but I'd like to have some decent asset protection. Well, the baseline of a client's trifecta of what we try to do for clients new to business, old to business, rich, poor, young, old, everywhere in between. We take their life and divide it in two sides. We put the revocable living trust down here. Now, a revocable trust has no asset protection. It's all about making sure there's no probate. And anything I own goes to my family the way I want with all sorts of rules. The trust would own any LLC that you might have. So Alex Murdaugh has some real estate and he's got other partners out here. And so we have to say, well, do these other partners, are they protected from a creditor coming in here and selling these assets? Because these Other owners might be like, what the hell? That's not fair to me. Now, South Carolina recognizes the charging order protection entity. Now, I don't want to get too technical, but I'm going to do it. I mean, I want to throw down here, if you have a regular LLC and let's just say around the corner, I don't know, we could say which state would be a good example around the corner there. Let's just say Arkansas, just in the general vicinity. South. If I have an Arkansas LLC and I have a rental property in it versus a South Carolina LLC with a rental property in it, and I'm the owner, and, boy, I'm looking kind of ugly there. Let's fix that. And I'm the owner of these two LLCs, and I'm driving through a crosswalk, texting and driving, and kill someone, and they sue me for a million dollars. In South Carolina, they just get what's called a charging order against this llc. They can't force me to sell it, can't touch it. They just get a charging order. And so I'll spell that out, charging order. And a judge says, hey, if you distribute any money, if you sell it, it's got to go over to this creditor over here that you owe a million dollars. And you're like, okay, are you ever going to sell the property? No. And so the creditor's left out in the cold. That's called charging order protection entity. And there's about 13 states like that. Well, sorry, it's 22, my calendar anyway, so I think it's closer to 20 states that number right here in front of me. But this charging order protection is. Is to protect the asset from me. Now, over here in Arkansas, they can get inside the llc, force me to sell it, take the money and give it to the creditor. Now, if there's a lawsuit from a tenant, I'm protected. Bing, Bing. That's the purpose of the llc. That's why I set up an llc, is to protect me from the tenant. But here I get protection from the tenant and I get protection from me. So the creditor can't get in there. That's called a cope. Well, in South Carolina, where Alex Murdaugh lives, if he has any real estate in a charging, properly structured cope, under South Carolina law, they're not going to be able to get in there and sell that real estate. So that's a piece of the equation. So any of you out there that own rental property, we want to be talking about what type of LLCs you have how many LLCs you have? We don't want to overdo it. We want to find a balance. Now over here, if you have a 401k or an IRA, they're also going to be protected in a certain way or not. In South Carolina, we would have the beneficiary be the trust. So normally you name your spouse and then your trust. Well, Maggie's gone now Alex is the beneficiary, and so he does not. No creditor. A creditor can't get into these IRAs and 401ks. And we saw that with O.J. simpson. Now over here, you might have an operational business. Maybe you have an LLC or an S corp and you're making money and you're spending money. Well, I don't leave any money in my corporation. I don't want money in my corporation. It owns a laptop. You can have it. But the purpose of this entity is to save taxes, build wealth, save on self employment tax and fund the 401k and take distributions and go buy real estate, go buy stock and ETFs, go buy crypto, go invest in notes. All of these different investments I can create. LLC is to create more coat protection. So anyway, it's not. Rocket science is making sure you have the right entities set up, that you're maintaining them. One sheet of paper at Legal Zoom is not a proper entity. We've got to make sure we have all the pieces and parts. We have a cleanup special right now at our law firm. If you guys have an LLC or an S corp and it doesn't have a book and minutes and all that, please call the office or go to the website and get a cleanup. We have a discount every year and this is actually the year time of year, so it's kqslawyers.com and you can get your LLC or your corp cleaned up. And that is going to give you better asset protection. If you just have one sheet of paper over here, you have about one fifth of an llc. And if you have a corporation, same story, you've got to have all the pieces and parts. Okay, well, people, that's the general, that's the report, that's the issue. Can you pop me off? And so we want to just kind of talk here now and see if I can help answer any of your questions about asset protection. And if you want to vent about Alex Murdaugh and his assets or ask questions, I told you pretty much everything I know about the case. But when it comes to his assets. But we'll See what happens here soon in the news.

Can we please do a disclaimer about the bitcoin comments, please?

Yes. I'm so sorry, everybody. There's a. Yeah, a computer bot likes to tackle any live broadcast on Facebook and they're going to come out here and say, hey, I just made a bunch of money with bitcoin or crap. Please, I am not posting on this live chat. I'm looking for your questions and we're going to read them. Anyone watching on YouTube or Facebook, do not respond to any of the comments regarding investments or cryptocurrency. It's a scam. They're bo verified as a on my platforms, but we still get these, these computers coming out of who knows what part of the world. All right, James, what question? Anything good out there?

Well, got a question from Stephanie McCabe. Welcome back, Stephanie. How does a domestic asset protection trust differ from an RLT regarding asset protection in California? It's an either or scenario, not both, correct?

Yes. No, it's either or when it comes to asset protection. But if you do implement, you use both. So everybody, let's talk about this. I've got articles on my website. Maybe James, you pull one off my blog and just connect it there so they can. Someone could do some more reading on this. But if we go over to the whiteboard here, let me describe, we'll kind of go like here, here's my revocable living trust. And Stephanie's there in California. And what we do, we divide your life in half. And we're worried about our asset side right now. That's kind of what we're thinking about. So what we want to do is consider what's called domestic asset Protection Trust. Now, they're, they're not on the books in the state of California. It's called ADAPT. Now in the states that allow for ADAPT, 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 40, 15, 16, 21 states have a dapt law. Some states have better dapt laws than others. But here's what the rule says. If you own a home in a domestic asset protection trust, some states there's a three month waiting period, six month waiting period. Sometimes they're immediate. Sometimes you can be the trustee of the dap, sometimes you're not. And there's a distribution trustee. They're fairly complicated. I think we're charging around three grand or whatever to set these up. But the beauty is once you set up adapt, if you get into any sort of lawsuit, Stephanie gets into any lawsuit, they cannot get at the assets in the domestic asset protection trust. So California, that has a kind of crappy homestead exemption. So we look at California, 75 grand if you're single, 100 grand if you're married. So if you got a million dollars of equity in your home in California and you get into a lawsuit, now let's assume it's paid for or what? Well, you know, let's get real. Let's say you've got a million dollar home with a $400,000 mortgage, that means you have equity of 600 grand. If you get into a lawsuit in California and you're liable and your insurance doesn't cover you, and by the way, umbrella insurance doesn't cover everything, people. That's why it's so freaking cheap. You're like, oh, I'm not gonna get an llc. It's too expensive in California, I'll just have umbrella insurance. Yeah, good luck with that one. It pays out less than 1% of the time for a reason. And that's why it's cheap anyway. So you've got 600 grand of equity, 100 grand goes to you. That's your, if you're married, 75 grand if you're single, that's your homestead exemption. So you get to take that and go start another life with that 100 grand. Whatever's left goes to the creditor. So that 500 grand, that's what the creditor gets. Now if you have adapt, they get zero. Problem is, in California, they don't have a dapt law. So you have to go to court and go, your honor, don't honor this dapt that was set up in Utah or Delaware or Alaska or Nevada. We're here in California. This is a California home. This is a California resident. And we had a California creditor in a car accident. So this little dapt set up in another state, it's bullcrap. Now, if the lawsuit got far long enough, you're right, the dapt would be worthless. But it does create barriers. And we had a client that had a claim in a lawsuit and the dapt had a bank account at Wells Fargo. And Wells Fargo said until we get a court order to go distribute this account, we're not doing it because it's an adapt. And I don't care what the law says Until I have a judge tell me and tell me that the law is wrong or right, we're not touching it. And so this might happen with a title company, a brokerage, you may not get title insurance. If you're the buyer of this home. So adapt can lock down assets and make it very difficult for a creditor to get there. So if the creditor doesn't have enough money to pursue it, the dapt could provide some benefit in a state like California. That's all I'm saying. Some. Every lawsuit can be different. But, Stephanie, here's the take. You still have your revocable living trust. Your revocable living trust still owns your. Your real estate, still owns your. Any other assets, your llc, your corporations. And this revocable living trust distributes to your family. The beneficiary of the DAPT is your rlt, so you have both. You have a dapt here, and then you combine it with the rlt, so you have both. If you want the asset protection, you can do either or. But we always want an RLT at the foundation for our clients. Great question. It was a very difficult one. I'm very impressed. Let's give her a book, huh? Can we give her a book? Let's give her a tax and legal playbook. She deserves one. Oh, Courtney, are you. Courtney, are you giving me this next question or is James. Yeah, I am.

This is from.

All right, what do you got?

This is from Ryan Lee. He says, I have a trust set

up by your company. How do I connect it to my llc? Okay, great. Ryan. Thank you so much. Well, Ryan, we have a couple paralegals that all they do is transfer or fund assets into the trust. So once your trust is complete, we have, depending on the trust package you got with us, which is still very, very affordable, that might include a membership transfer to the trust. It may not. It just depends. But I think we charge like a hundred bucks or so. It's very affordable. But what you would do is call the office. Should I send them over to Whitney? Would that be the place to go? Not for the trust transfer. Go to cora. Cora will figure it out. Christy. Okay, so I'm just getting the report here. You would call the law firm, go to kkoslawyers.com, talk to Christy Rice, and she will execute the membership transfer agreement to transfer your LLC into your trust. Again, the formation of your trust, if you had certain assets, will sometimes include some of those transfers, but then clients will come back years later or months later and go, oh, I just set up an llc. Can you transfer it to my trust? So there's different timing issues, but talk to Kristi Rice, and she would work with you on getting that LLC transferred to your trust. And all of you out there, if you have a revocable Living trust. You want to make sure everything's transferred into. It's called funding the trust. You don't put it in the trust. And trust ain't worth anything. Got to make sure it's funded. All right, next question.

All right, what about Oklahoma? What is the exemption for llc? Ownership of assets in Oklahoma. Oklahoma. Oklahoma.

You know, Oklahoma.

You know.

You got that one. Yes, I do. James is an actor and a prior life. So if he could sing and dance, he would. He. He busted out right here. Oklahoma actually has great asset protection, everybody. It's one of the best. It's actually quite incredible.

And I'm sorry, that was from Greg Smith. Greg. Greg.

Okay, Greg, buckle up. You're going to love this. So with the. We'll do our trifecta. Every client, we're going to talk trifecta. Your revocable living trust, Greg, is going to own your home. Check this out. Oklahoma, unlimited asset protection. This is just like O.J. simpson in Florida. No, no matter what lawsuit you get into, they cannot touch your home in Oklahoma. Can you believe that? Here's the states that are unlimited. We've got. Okay, let's get the numbers here. Washington, D.C. florida, obviously. I already said that. Iowa, Kansas, Oklahoma, South Dakota, and Texas. Those are our unlimited homestead exemptions. Some have some decent ones. Massachusetts, 500 grand. Some have none at all. New Jersey. Freaking A. We're going to kick you to the curb in New Jersey. 390,000 in Minnesota, 550 grand in Nevada. Those are some of the big ones. So first you have unlimited homestead exemption number two. In the state of Oklahoma, you have COPE protection. So with an llc, if you have rental properties and you get into a lawsuit, no one can get into the LLC and force you to sell it. Now, when I say no one, I'm saying, I mean, there's probably some federal, you know, crime unit that might have, you know, Secretary of state approval, attorney general approval at the state or federal government to get in there. But just barring anything out of the weird or out of the ordinary as COPE protection. So they cannot get into your LLC in Oklahoma and take away your rentals. And if you get into. If a tenant wants to sue you, as long as you weren't a slum landlord, they can't get out of the LLC either. So you have coat protection, unlimited homestead protection. And in the state of Oklahoma, you can also have adaptations. So you might put together a domestic asset protection trust for your crypto wallet, and no one can touch your crypto or your stock brokerage account, whatever you want to do. And finally, what's kind of cool is you can have a series LLC in Oklahoma, so you can have baby LLCs at no extra cost. They're called sub series. So Oklahoma is a great state for asset protection and organization. I got to clean up my little dapped here. That look better. All right. Okay, next question.

All right, this next question is from Randall Cotner. Could the court attach the LLC membership interest as personal property?

Randall, I don't know if you'd use the word personal property, but you could, I guess, in a bankruptcy action or in a collection or receivership, which is somewhat similar. And they're all going after Alex Murdaugh's assets. That's what a COPE really is doing. So here, if Alex Murdaugh owns this LLC and there's two or three other partners, personal property can mean a lot of things, especially in taxation and in bankruptcy and other things. Let me just say this. COPE means the creditor is attaching. They're saying, hey, I'm going to take Alex's place and move me into this spot, and I'm going to wait around for any money that comes out. The COPE means you can't go force them to sell real estate or force them to liquidate the llc, but you are still attaching yourself to the llc. You're kind of stepping into Alex's ownership, if you will. That's the purpose of a charging order. The judge is issuing an order and charging you to give that ownership over to this creditor. But the creditor has very, very little rights. And it's a. The state legislature in these states that have a COPE said, that's what we want for our citizens. Other states have said, hell no. So that's the way it works.

All right, next question is from Usima Mark. I'm a tax preparer, and I hope, I hope I got the name pronounced correctly. I'm a tax preparer from Chicago. I'm looking to get more information about your certification program.

Oh, wow. Who planted her in the crowd? I love it.

Mic drop.

Well, for all of you. Thanks, Yusama. Boom. Mic drop. For any of you out there that are enrolled agents, and that's a helm. Sorry or want to make. Oh, sorry, Yusuma. Sorry. Some names are hard for me to understand. The gender, forgive me. But for any of you out there that are accountants, enrolled agents, CPAs, attorneys, financial advisors, business consultants, and you want to be certified as a tax advisor, I have the Main Street Tax Pro program, over 70 videos, weekly trainings, membership forum, and these videos Come with exams. They're not that hard, but they keep you on your toes in 12 modules and these, gosh, over 800 questions. And my ongoing training gets you certified. You'll be able to bill more per hour and really help people. And that's what really matters. People out there are starving for good accountants. I was just talking to Deb earlier today. I mean, it's just a. It's a nightmare out there trying to find a good accountant that'll pick up the phone and strategize with you. It's tough. It is really, really hard. So if any of you want to get certified, you can get a free demo of the program and join a call with me as early as next Tuesday. We get together as a group. We have hundreds in the program already and we've got graduates. And if you're looking for a certified tax advisor, you can go to the markjkohler.com site and go up to the advisory network. And we're adding new advisors almost daily that are around the country that you can interview and see if you're a good fit to work with them. I don't make any money. If you hire them, that's up to you. You can interview them. They're going to interview you, and you can find an advisor. So use them to check it out. I know it's going to whatever you, you're going to make double what you pay me to get in this program within the first couple months, easy. I want to increase your billing rates, your services, and help you serve your clients better. Check it out, everybody. I appreciate that.

Great job. Mark. We got next question from Salvador. Can I structure a separate entity as a partnership with that partner only holding, say 1% or something to still protect those assets? 1% or something. What do you say about that?

Here's the thing. You bet. Let's go to the whiteboard. What's his first name again?

That one is Salvador.

Salvador. Sorry. Salvador, everybody. Let's kind of look at this. What Salvador is saying is, and there's kind of three degrees of LLCs, if you will. So let's call this LLC single member. So single member LLC. So you just own it 100% then. Oh, my gosh. I'm going to go four degrees. You guys are getting doctorate level asset protection here. We're going to call this a single member LLC in a regular state. I'm going to call this reg state, just a regular state. Then I've got the LLC single member in a COPE state. Then I have a LLC with multiple Members. So we call that a multi member LLC. And I'll even use Salvador's example, a 1% owner, 99%, that's still a multi member LLC. And we're going to say this is an LLC in a regular state and this is a COPE state. Okay? All right. If you're in a regular state, single member llc, you're toast. Any creditor is going to be able to get into this LLC and take away anything it owns if they get a judgment against you. By the way, that's the majority of the states. Over 25 states are that way. Now, some states say we're going to give COPE protection to an LLC even if it's a single member. Some states go, well, we'll give you cope, but you got to have the multi member llc. An example of this on a COPE level, and I wish I had some of my attorneys here in my office are in the trenches on this, but I think we've got a couple good examples of this would be Ohio or Wyoming. Now South Carolina and North Carolina, I believe you have to be a multi member cope. So to answer Salvador's question, depending on the state you're in, this is why doing a consult with one of the attorneys setting up your LLC. By the way, people, we're turning like 1500 bucks and you get a real consult with a lawyer. Don't go out and try to find a free consult with someone that wants to sell you unlimited LLCs for 20 grand. Just pay for what you need and expand as needed. Get a fair exchange. So this doesn't have what I'm trying to say. It doesn't have to be expensive. But in Salvador, in some states you're going to need this one and this one's worthless. I'm sorry, in some states you can get away with a single member llc. In other states you have to have the multi member llc. You could do a single member LLC in South Carolina and have no coat protection, for example. So you want to find the states that either require single or multi member. Now this is a big question mark. Let's say you're in a state that does not have coat protection, but it's a multi member and this yahoo gets in a huge lawsuit. Well, there may be a court action to liquidate this LLC and go after the real estate. Well, these other partners are going to show up in court and go, your honor, this is not fair enough for us. We don't have a COPE law in this state, but we're begging of you, do not sell this property. We'll buy this guy out for the equity and just give it to the creditor if we need to. But don't shut down our LLC and force us to sell it. Why I put a question mark is it depends on the court what the judge wants to do. And there's different case laws in different states regarding this situation. So, Salvador, the answer is it depends on what you're trying to do, how much equity, what state you live in. It can get really tricky. So get a consult with one of the lawyers. I trust you. It'll be worth it.

All right, that was great. Okay, James, this next question, it's a long question from Miguel. Thank you, Miguel. This is great. That kind of flows right in to what we just talked about. So, hi, my name is Miguel and I live in California. I have my pool business and a rental property. I recently. And this is. Is what it is. I recently set up my LLC for my business. I did it online. I don't have the books to manage anything like that. Just got started, got it for free, but I'm interested in going legit. Now, do I need another LLC for my rental property, or can I combine it with the LLC for my business? I'm assuming.

Great question.

Free llc.

Miguel, thank you so much. Yeah. Let's go over to the whiteboard. So, Miguel, excellent. So one of the first things I do, everyone in a console, our lawyers are going to say, okay, Miguel, that's great. One last question. Do you have your will and trust in place? And if Miguel says yes, I'm married or single, but I have kids, and I want to have my trust in place. So our first question would be, let's make sure we get your trust done at the same time. Because if we go set up these LLCs and then we set up the trust later, we got more cost trying to transfer things around. And we'll discount things on occasion when we're doing package deals. You know, let's help clients get all structured. So, Miguel, don't forget the question about your trust. Now, if you've already set up an llc, I'm not saying we gotta go set up a new one. You probably have your tax ID number. You're running your pool business through this. That's excellent. I'm gonna ask you to watch some of my videos on YouTube. When to become an S Corporation. That's going to be your next big question, and that's critical. So watch some videos on that, get a consult. But everyone here's the big deal. Let's say he's out working on a pool, digs a hole, goes home at night, ready to come back to the house and the next day. And some kids are screwing around on their BMX bikes, comes around the corner, falls into the hole, and one of these kids break their neck. Miguel might be personally liable. He forgot to put up the cones. He didn't put up any yellow tape. He was negligent. Well, the LLC is not going to help him at all. So Miguel first has to be a responsible business owner. He needs to make sure he tapes off construction zones, puts up signs, and keeps kids away that may not know the danger. See, that's an important thing. If my kid went and rode into that hole and broke their neck, I'd sue Miguel. I'd be like, miguel, what the hell? You can't dig a hole for a pool and not put up a sign. Watch out for the big hole. You know, you got to be careful. So, Noel, it's a pool cleaning business. That's fine. You know, maybe you drain the pool and some kid falls in on the cement, and you're cleaning the pool and a baby walks out. You left the gate open, Miguel. You're cleaning the pool. Some toddler gets through the gate you left open, drowns. What do you think the parents are going to do? They're going to sue you. You know, so you can have liability every which way. Swimming pools are like liability magnets. So. Plus magnets for kids on a hot summer day. But. So, Miguel, your LLC is not going to protect you if you're an idiot. You're out there drunk, doing whatever, driving down the street with crap falling off your truck. So everyone, no matter what your business is, be responsible. That's number one. Now, let's say Miguel keeps the gate locked and somehow this toddler sneaks around, climbs through the fence and drowns. Anyway, Miguel's got video coverage from the webcam on the house. He was responsible, but the parents sue him anyway. And I know that sounds weird that a California lawyer would sue you anyway. I mean, why would a California lawyer do that? They're so kind there. They're not a litigious state. They would never do that. Okay, so anyway, so you get into this lawsuit, and who are they going to sue? They're going to sue the law. The llc. Sorry, my pencil here. They're going to sue the LLC and they're going to sue Miguel. That's what lawyers do. So this family of the dead toddler is going to sue Miguel and the llc. Now Miguel's going to show up first day in court. And go. Your Honor, motion to dismiss. I am not personally liable. I was a good business owner. I have an llc. You know what's going to happen? This was on my show last two weeks ago. Anyway, this is what the judge is going to ask. Show me. Show me your llc, Miguel. You got articles. You got operating agreement. You got minutes. You got membership certificates. You got your tax ID number. You file a tax return. Do you have a business bank account? Do you have a contract in the name of the llc? If you didn't respect the LLC and have it cleaned up and organized, they're going to plow right through it because the judge is going to. Judge is going to listen to the other party, and the other party's going. Miguel doesn't have a freaking llc. He has one sheet of paper. You're telling me, you, Honor, we're going to respect these LLCs when the owner doesn't even respect them themselves? Hell, no. And the judge plows right through it, and you're liable. So, everyone, question number one of Miguel's is if you have an LLC that has just one piece of the eight parts you should have. You got to do a cleanup. He said he got it for free. Anyway, it's now time to pay the piper. Get it done right. And we have a cleanup special. Christy Rice. Go to our website, kqs, lawyers. I've got five or six paralegals that are doing these around the clock this month at a discount. Give us a call. Let's get your LLC done upright. We have a maintenance program. It's 150 bucks a year to do your minutes and keep it clean. You got to pay fees to the state. Who knows if your LLC is all dissolved. Now, second question. Would I ever put my rental property in that llc? Miguel, let's see. You got a sweet freaking little rental property with a couple hundred grand of equity in it. Do you want it in the same LLC where a toddler might sneak through the fence and get into, you know, problems? Hell, no. We never put assets in the same entity that we're doing operations. See this wall? This is our asset protection wall. So over here on the left side are ops. Over here are assets. Now, you've got a tenant throwing parties over a tenant throwing parties every weekend. And they're going to get into problems, and they're going to sue you personally if you're on title. We want an LLC here to protect you from the tenant. So the answer there is you need an LLC for your rentals, and you might Put two or three rentals in here. I don't know. I don't know what state your rentals are in too. Oh, Mark. But it's California. 800. Yeah, it's okay. It's called insurance. Because you live in California and your home's worth more and you want to live in freaking California. I moved out of California. I don't have contacts in Calvary. I don't want it. I love to visit it, but I don't want to live there. I'm sorry. I mean, I love In N Out Burger. I get it. But people, it is expensive to live there. And buying an umbrella policy for 200 bucks a year ain't gonna cut it. Sorry, Miguel. You brought out the worst of me today. You know what, Miguel? He needs a book. I want to send him a book. Will you put down Miguel for a book? We may give another one or two away. And don't. Don't. Message. Give me a book. If you write, give me a book. We're not going to give you a book. You just got to ask a good question. We'll hook you up. James, what do you got? Next question.

Next question I got is from Casey. First of all, Kkos helped me set up my hra. If I reimburse a medical expense through our company's hra, can I also reimburse that expense through my HSA in the future?

Echo, this is. This is Casey?

Yes, this is Casey.

Casey. Bless your heart. Hell no. That's a technical term. Sorry. No, you can't do that. You're double dipping. So for those of you out there that have a flexible spending account, a health reimbursement arrangement, or a health savings account, you can only get reimbursed for one once. It wasn't you. You know what I'm saying, Casey? I'm sure you were hoping for it. And I love, I love your name, Casey. I'm a Yellowstone fan, but I would just say, just choose one plan. Now, if it was me and you've got the money to handle it, I'd get reimbursed through the hra. Let your HSA ride. The health savings account is a tax free account that's going to snowball as you invest it. Let it keep growing. Don't pull out the $100 there. Go take the hundred dollars out of your HRA and you may. Well, I got money over in the hsa. Yeah, but it's growing. You don't need it right now. You got 100 bucks over here. Get the reimbursement get the write off, but use the HRA for that. Use the HSA for the growing of your account.

You ready for the next one?

I am.

All right, so this one's from.

I know sometimes I just pause. I feel bad. I should be like, james, I'm ready.

No, no, it's okay. Sometimes I just like looking at you just to see, you know. But this one's from our number one fan, Brenda. Thank you. You're the best. Do you have a checklist for us to make sure we have all the necessary info and paperwork to do to set up trust, etc. Checklist?

A checklist of what should be in a trust or an estate plan.

Trusts if we needed.

Well, yeah, maybe I'm, I'm going to try to. Brendan, you might need to reword that. Let me say. We don't give people checklists to set up their own trust. I mean, it's a, it's a legal service. You can set up your own trust by trying to go out and find the pieces and parts. But I, I, this. I was going to work on my ice maker in my kitchen this week, and I thought, you know what? I'm not going to get the checklist on how to fix my ice maker. I'm going to call an expert that knows how to fix my ice maker. So I'm going to do that. So, Brenda, I don't know if you're. I don't. I think you're asking. Give me the list so I can go do it myself. So let's, let's set that one aside, everybody. I go to Home Depot to buy tools and supplies, but not to remodel my kitchen. As much as I'd like to, I know I'll jack it up the. Now, if Brenda's saying, mark, do you have a good checklist when we go to set up our trust with you?

I believe that's.

And I say after. Is that what she's asking? I believe so. The answer is freak. Yeah. Let me run through some of those thoughts. When you meet with one of our attorneys, they're going to ask you a bunch of questions. I mean, we have a questionnaire that's like five pages long. We have two pages of just ideas. I want to give money to my kids when they go to college and money when they buy their first house. No money if they're on drugs. No money if they're still married to that loser. A third when they're 25, a third when they're 30. A third when they're 35. If they have good grades, they can have money. If they have bad grades, they can get nothing. If they're party too much in school and have a tattoo, they only get half their money. If they have long hair, they got to cut it, and then they can have their money. If this loser hasn't gotten married yet, he's got to get married. Then I'll give him money. I mean, you can put whatever freak rule you want in there. We have two pages of ideas. Crazy. So meanwhile, we're going to look at trustees, and who's going to raise your kids, and most importantly, who's going to raise your cat and dog? Because that's more important than your kids. Especially. I have teenagers. So you want to know all the different people that you're going to have involved in your estate plan? We've got a huge list for you. Your estate plan should not just be your trust, should have a will, powers of attorney for health care, powers of attorney for finances, special instructions, funeral and burial instructions. I'm going to get cremated and dropped off a boat in the Caribbean. Just kind of like, you know, like some sort of blue diamond, you know, just like, you know, something like that. Be really cool. But anyway, that was it. We got all sorts of good ones. So, Brenda, check it out. You're gonna love it.

So my. My next question is from John Godfrey. Thanks, John. So can I run?

I know John. John, love you, man. I know John. He was one of my scouts back in the day. I was a scout master. And John, he. He's a stud. We. We've. We've been out camping and fishing together before. Hope you're doing well, John.

That's awesome. So can I run two DBAs under the same LLC?

Yes, John, I love. Let's go whiteboard. I just want to give this an example to everybody. See, some of you may think, oh, Mark, you have a law firm, and you got. You can have as many S Corps as you want, blah, blah, blah. No, I have one S Corporation. That's all I want. That's all I need. So I have Mark J. Kohler, Inc. Boom. And John Godfrey might have JG llc. You know, whatever. You just have your one main entity. You can have DBAs. You could have multiple URLs. My GoDaddy account is owned by my Inc. You could have multiple trademarks. And if I go partner with someone, I'm here with Tristan. Tristan's like, hey, Mark, I got a idea. A great idea. Let's go open a restaurant. I'm like, all right, so we go open a restaurant. Well, I don't want to pay self employment tax, so I own my interest in my S corp and Tristan owns his interest in his S corp. So I'm going to have llc. I'm going to have. But I'm not going to put assets rentals go over here, John. But you can have multiple businesses going into one corporation. When you can, you think of how Many businesses and DBAs and URLs and patents Microsoft owns, same thing. This is my parent company. I can have as many DBAs, trademarks and LLC as I want flowing all into one. So, John, you're on it. Hey, let's give John another book. John, I know you've got my book, but I'll get one off to you signed. Give it to your mom, you know.

Sure, let's do it. Sounds great. You got time for one more?

What do you want to do? We're. One more question.

This is from Charlotte Faris. You love this one. Can. Can you have an LLC in a state that you do not live in?

You can. You probably should. What's. How do you pronounce the first name there?

That's Sharla.

Sharla. Okay, let's go to the whiteboard.

Charlotte. But I think it's Charlotte.

I wish I knew what state Charlotte lives in, but I'm just going to choose a random state. Sharla lives in New Jersey. What? You don't like New Jersey, but give me another state. Come on. I got someone scoffing at New Jersey.

We just lost several in Charlotteville.

What's she asking about? Other. Other. She lives in where?

Let's see.

Charlottesville, North Carolina. Where do you live?

Charlotte. She's commenting. It might take a second.

Okay.

Colorado. Colorado. But moving to. Okay, I lived in Steamboat. Love Colorado.

Colorado. I can't spell it here.

Okay, let's fix moving to Oklahoma. So I'm assuming keeping the llc, calling

in high from Colorado.

In Colorado.

All right, so okay, now, so Charlotte says I can I set up an LLC in another state? I'm going to say you should under the. I'm going to do two following circumstances. One, Charlotte lives in Colorado, but she's like gonna buy a rental property in New Mexico because Albuquerque has great rentals. I mean, you can set up meth labs and just kill it. I mean, I am a fan of Breaking Bad. Albuquerque.

I think she's moving to Oklahoma and possibly keeping the business in Colorado. I did this, so I know all about.

Okay, you owned a meth lab in Albuquerque too.

No.

Colorado oh, you had one in Colorado.

That's where the production company is at?

Yep, that's the product. Okay. All right. So the production company for the meth lab was in Colorado. Okay. So what we do is if she's going to buy a rental property in New Mexico, she has to set up the LLC in New Mexico. You want the LLC in the state where the rental property is located. So we have New Mexico LLC, owned by Sharla, in Colorado with her revocable living trust. And then, oh, my gosh, she says, I'm moving to Oklahoma. Well, she already had an LLC for her flower business, so she's got a flower business.

It's actually cow meth. She said it was only cow meth,

so I don't know what that means.

Cow meth. Meth lab. Cow meth lab.

Cow meth labs. I didn't even know you could have a cow meth lab. I'm so confused. Okay, so she has a flower store in Colorado, and she goes, I'm moving to Oklahoma. Okay. So she's like, but my flower business in Colorado is killing it. So she has a couple choices. She could then register her LLC in Oklahoma as a foreign llc. Now she has flower store number two in Oklahoma and flower store number one in Colorado. But she says, yeah, but, man, my flower store in Colorado is freaking. It's crazy. You know, it's in a bad neighborhood. I need. I want asset protection. So then we do option two. We say, let's bag that idea. Not a good idea. We're going to open up a second LLC for the flower store. And I have clients do this with chiropractic locations, dental lab, dentists. You know, whenever you have an operation in another state, we're going to have the Colorado LLC here and the Oklahoma LLC here. And then she goes, you know what? I hate living in Oklahoma or Colorado. I'm going to move to Texas. All right? So she can live in Texas, have a New Mexico LLC for her little rental, an Oklahoma LLC for flower store number two, a Colorado LLC for her flower store number one, and have all that money go down to her in Texas. That's how it works. So you want to set up entities where you're doing business, not where you live. So why don't you give Sharla Charlotte.

She's definitely in the business of cow methane. She.

She's in the business of cow methane. Yeah.

Does that make sense, what that is? But it's.

It doesn't smell good. I can tell you right now. I can feel it. Yeah. Not Good.

I would love to give Charlotte a book. Yes.

Thanks for letting me joke around with you. Cover some important asset protection topics. If you're a winner of a book, please email Diane. D, I, A N, N E. That's Diane with two N's. Dianearkjkohler.com and she will verify your information as a winner through with Courtney and James, and she will get you a book out in the mail. I want to say thank you to Tristan here in the Phoenix studio and Deb, my executive assistant, making things happen. Our intern, Courtney, who works for free and goes and gets us food and drinks all day long. We sure appreciate her.

She's laughing, James.

Thank you there.

Can I name off these names for you just to double them out there?

Okay, Tell us the winners.

The winners. Miguel. Miguel. Outstanding question. I want to give you a nice book.

Sharla.

Obviously, we're going to give you a great book. And John, thanks for participating today. Really appreciate you.

Hey, I threw out a book early on. Who did I give a book to

when you were Stephanie. Stephanie McCabe. I apologize. The Tax and legal playbook to Stephanie. Thank you, Stephanie. She's gonna say she already has three.

Oh, and John and I gave one to John to give to his mom.

Yeah, yeah. I named off John Godfrey. We got you. Oh, God.

You did? Okay. All right. Hey, everybody. Love and appreciate you. Thank you for being here. Be back next Thursday and we'll find an exciting topic to help you build wealth, save taxes, protect your business. Excited about this new year, people? You control your destiny. It's all up here. You get out there and keep working hard. Don't give up. Every day I wake up, I have doubts, I have struggles. It's frustrating, it's hard. But you just get up and you go, people, there's no get rich quick scheme. You just get and go. Get your side hustle developed, work on it on the side, live the dream, and just try to be a little more happy and cheery and help those around you. You guys have a great week. See you next week.