March 11, 2025 • 41 mins
In this episode of the Main Street Business Podcast, Mark J. Kohler and Mat Sorensen give you the blueprint for bulletproof asset protection. From LLCs to trusts to holding companies, find out the smart, cost-effective strategies that work without the extra fluff.
Here are some of the highlights:
- Mark & Mat break down the biggest asset protection scams and how shady promoters convince people to buy unnecessary LLCs, trusts, and offshore entities.
- Mat discusses when you should separate your real estate properties into multiple LLCs vs. keeping them together in one—so you don’t overcomplicate things.
- Mark reveals the truth about “anonymous LLCs” and how to use Wyoming holding companies for real privacy protection.
- How to build an asset protection plan that actually makes sense for your wealth level—so you don’t spend money on pointless legal structures.
- How to avoid setting up LLCs that end up costing you more in taxes than they save you in protection.
- Why your asset protection structure must match your tax return—or it could get torn apart in an audit or lawsuit.
- When you should separate your real estate properties into multiple LLCs vs. keeping them together in one—so you don’t overcomplicate things.
- How to legally minimize tax burdens while keeping your asset protection plan airtight.
- Grab my FREE Ultimate Tax Strategy Guide HERE!
- You don't want to miss this! Secure your tickets for the most significant business, tax & legal event of the year: Main Street 360
- Looking to connect with a rock star law firm? KKOS is only a click away!
- Are you ready to get certified in EVERY strategy I teach? Start your journey with a FREE 15-minute discovery call to explore the Main Street Tax Pro Certification.
- Check out our YOUTUBE Channel Here: https://www.youtube.com/markjkohler
- Craving more content? Check out my Instagram!
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to the Main Street Business Podcast with
your distinguished hosts, mark JKohler and Matt Sorenson.
Both are best-selling authorsand have over 25 years of
industry experience, with 10,000client consultations, making
them the leading tax and legalexperts in the nation.
Together, they'll unpack themost complex tax, legal and
financial strategies crucial forsaving more, stressing less and
(00:23):
building generational wealth.
Today they're your personaladvisors, ready to break it down
for you and make the tax andlegal game easier than ever.
Speaker 2 (00:33):
Here is Mark and Matt .
We're doing this to have a moreprivate life where we can be
protecting our brand, ourreputation.
Speaker 3 (00:39):
I had a Grammy award-winning artist, very
famous you would know who it isand they were very concerned
about privacy.
When we up the llc and we usethis structure we're talking
about here, you might not have ahigh public profile, but you're
like I just don't want my nameout there.
Speaker 2 (00:52):
I just don't need it out there floating everywhere,
yeah, and your brand, yoursocial media presence.
All of a sudden, someone sees alittle something.
They just want to make a bigdeal about it, and it it's not a
big deal, but your name wasthere.
Bottom line.
There should be no fear.
There should be no pressure.
We're not just TV lawyers.
Speaker 3 (01:07):
We're real lawyers.
It's not just two good lookingguys.
Speaker 2 (01:09):
We could have been on suits Right.
Speaker 3 (01:12):
Welcome everyone to the Main Street Business Podcast
.
This is Matt Sorensen, joinedby the incredible Mark J Kohler.
We're excited to be with youtoday because we want to talk
about keeping the money and allthe hard-earned assets that
you've built up.
Speaker 2 (01:24):
Yeah, and I think the topic that goes hand in hand
with that that I've been sovocal about over the last 25
years is also making sure youdon't get scammed and sold crap
you don't need.
There is so much out there inthis asset protection industry
of you need a Wyoming entity oryou need a Nevada entity or
Delaware, and you can hide andoh, get in your vocal trust and
(01:45):
go offshore and you know, andthere's just so much crap out
there too.
So we want to be a voice ofreason, give you some straight
answers today on what works,what doesn't, how to take action
and what it might cost, andthen you're more well-equipped
to go out and choose theprofessional you need.
Speaker 3 (02:01):
Yeah, and I hate to say it, but every bad idea and
recommendation out there has alittle dose of truth in it and
it's kind of built off of thatand then overdone.
So we want to talk about whatshould you actually be doing?
It might be different in yoursituation.
We'll try to give you someguidelines here about what may
work and make sense for you, butat the end of the day, you want
this to be tailored to yoursituation.
Okay, so we're going to comeback to that towards the end.
Speaker 2 (02:23):
So the main goal here is let's bring this in from
30,000 feet down to 2010.
We're going to land this babysafely with all the FAA stuff
going on.
Oh my gosh, so 30,000 foot view.
A lot of people are like okay,I'm buying rental real estate,
I'm investing in the market.
Okay, I'm buying rental realestate, I'm investing in the
(02:43):
market, I've got XYZ assets.
I want protection If somethinggoes wrong.
I'm driving a car, my teenagersare driving, there's a lawsuit
that comes after me or insideone of those operations.
And number two I'd like alittle more privacy.
With the web and transparencyout there and Siri listening to
everything I'm doing, I justfeel like I could use a little
(03:06):
more privacy, because it's alayer of protection, but it's
not protection itself.
I call it the camouflage.
So what we're really lookingfor is kind of that bulletproof
vest that'll help you to somedegree.
That's asset protection.
That's asset protection.
And then the camouflage thatwill help you just be a little
less noticed.
And if I'm going to go intocombat, I want both, and that's
(03:28):
what we're going to talk aboutas we zoom in here.
Speaker 3 (03:30):
Yeah, and everybody might be a little different here
, okay.
So once you just keep that inmind here as we're talking
through this.
The other thing I want you tothink about is two other
overriding considerations here.
One is taxes.
We want to make sure we'redoing this in a tax efficient
way.
We definitely don't want astructure that's going to cost
us more in taxes, so I make surewe're doing it in a tax
efficient way, maybe evenconsidering audit risk too.
There's a couple ideas therewe'll have for you.
(03:52):
And the other thing is yourcost and administrative burden.
A lot of times we'll see stuffthat gets set up for people and
we're like you're a dentist withone rental property.
What do you need 20 LLCs for?
I mean, I hate to say it, butyou got oversold here.
You don't need all this crap,not just because of the cost it
took to set it up, because ofthe cost to maintain it.
Speaker 2 (04:13):
Yeah, and I want to be very this is.
This is peeling away the onion,pulling back the curtain.
You're going to see wizard ofOz, right here is what what
certain law firms even there's alot of promoters out there that
don't even have the legallicense to sell a lot of their
asset protection and crap butwhat a lot of times they'll do
is say, okay, so let me put itthis way A client comes in and
(04:36):
they've got this elaboratestructure, just like Matt said,
they could be any sort ofprofession, they've got way more
than they need and they're on apath.
But we're like, holy crap, thisis a lot of work and it cost
them a lot.
And the reason why it happenedis these companies or firms that
promote this will say, well,this is where you want to go, so
(04:58):
let's set up the structure soyou have it when you get there.
And a lot of buyers, consumers,business owners, investors, like
you maybe, are like yes, I wantto have what I need, so when I
get there, it's already good togo.
I understand that and I want tobe sensitive to that.
But it's expensive and youdon't need it.
(05:19):
I don't go out and buy a pairof jeans that I can't fit into
right now, it's a waste of money.
And buy a pair of jeans that Ican't fit into right now, it's a
waste of money.
Now, if I work out and I'm onmy diet and la, la, la, okay,
then I go out and buy that pairof jeans and that's how we feel.
Let's not overdo it, let's notbuy more than we need right now
and we can build on a properstructure.
But I just wanted to recognize,I think, why people get there
(05:42):
and again, it's that sliver oftruth that gets exploited, yeah,
so let's talk about your firstconsideration.
Speaker 3 (05:48):
As you're thinking about this, if we're going to
build asset protection and let'smaybe start there, we'll come
to privacy here in a momentwe're thinking asset protection.
We first need to think what arewe protecting?
What assets do I have?
Do I have?
a significant amount of assets.
Yes, right now.
Now you at least might have apaycheck, a W-2, maybe income
from your business you don'twant that garnished.
Even your bank account, rightthat you might have even some
(06:11):
day-to-day money or maybe somesavings.
Your retirement accounts areotherwise typically protected,
so we don't need to haveentities for those.
You can file bankruptcy andstill keep your Roth IRAs and
your retirement accounts.
Speaker 2 (06:23):
And in a lot of states your home could have
homestead protection and a lotof things.
Speaker 3 (06:26):
You get a homestead exemption in your state.
There's certain limits thatcould be.
Some states have a lot, somestates have a little.
So you might want to look thatup and Mark's got a guide in his
book.
It's even in his calendar Ifyou want to look that up.
Those details we got on oursite as well.
But I want you to just focus inand think about that.
What do I have?
Maybe I do have a significantbrokerage account, a lot of real
estate that I own, some land, asecond home, other businesses.
(06:50):
I want to protect those thingsfrom other incidents that could
happen in other places of mylife.
The more of that you have, themore asset protection you need.
Speaker 2 (06:59):
You know and we've talked about this in one of our
other podcasts when you'restarting to work with your
retirement accounts, doing aninventory but I think this is a
great opportunity to say thisnow If you are concerned about
asset protection and privacy, Iwant to see your financial
statement, I want to see yourbalance sheet and it's
attorney-client privilege.
You should be working with anattorney on this process,
obviously, but sometimes clientscome in and say I need asset
(07:21):
protection.
Well, what do you got?
Well, I got this, or well, Igot that.
Well, what entity do you have?
Well, I think I set one up overhere and I think I've got.
Okay, why don't you do aninventory first?
And you're going to feel morein control.
You're going to feel morestrong or weak based on what
that looks like, and we want tomake sure that we are making
good decisions based on correctdata.
(07:42):
And so I think step one in thisprocess too especially before
you even get on a call with oneof our attorneys, for example is
have at least a list what arethe fair market values and what
are the mortgages or debtsagainst those, and what's your
equity?
Because if you've got a lot ofassets but they're leaned to the
hill.
Okay, we're looking at the netexposure, not the fair market
(08:05):
value.
Speaker 3 (08:05):
Exactly, and I think when we do, and I think when
you're working with any lawyerhere, you can work with our
amazing team at KQS Lawyers.
But I'm just saying here, whatthey should be doing is taking
that inventory to know whatassets am I trying to protect.
We're going to have differentstructures depending on what
type of the assets we're tryingto protect.
Or we might not need anystructure, For example, if all
your money's in retirementaccounts or something like that,
or we can do very limitedthings.
(08:27):
The other thing I want to wewant to look at is your actual
tax return.
Okay, we want to look at yourtax return and see how are you
reporting income?
Where are assets showing up onyour tax return?
Sometimes there's tax andplanning opportunities.
You don't want to do some assetprotection planning, which we
see all over the place thatjacks up your taxes and now
you're paying more taxes becausesome idiot didn't understand
tax law.
But they thought they created agreat asset protection plan, so
(08:49):
it's got to be coordinated theydo, and I love where you went
with this.
Speaker 2 (08:52):
And, by the way, we're going to give you some
practical.
What does this look liketypically and what would you do?
Next steps here in a moment.
But this mindset andperspective is so important
because you want to be alignedon what you're trying to
accomplish and know what youhave and where you're going.
So I just want to piggybackwhat you just said too.
It's not always, yes, you wantto make sure you're not
undermining your tax planning orwhatever, but a lot of times we
(09:14):
look at your tax return andwe're like yeah, that's not what
your asset plan says.
Because to me, a tax return islike your blood work.
You're like, oh, I hurt here, Ifeel bad, I've got all this
stuff, I've got all this.
Really, I just looked at yourblood work, that's not the
problem, it's over here.
And another way of saying it isjust, does your tax return
(09:36):
reflect your legal structure?
Because if it doesn't, nowyou've got issues, but
potentially an audit, and if youget into a lawsuit, this is
what plaintiff attorneys want todo.
They're like this guy says thisis what he's doing.
That's not what he's doing,because your tax return tells
the true tale.
Speaker 3 (09:52):
Yeah, yeah, it can be discoverable and you sign it
under penalty of perjury.
So trying to backtalk that withany lawyer when you're on the
stand and like a penalty ofperjury, you did sign that, so
were you lying then?
Are you lying now, sir?
That's the question.
Are you lying to?
Speaker 2 (10:08):
the IRS or you're lying to me.
Uh well, I thought myaccountant knew this.
I thought my lawyer and this isa problem too is you work with
a lawyer that doesn't understandtaxes and that's not going to
help.
So can I say this Now let's getpractical, let's get baseline,
and what we do with all of ourclients when we start this
process is we build what we calla trifecta.
(10:29):
We want to have a visualrepresentation of what you have
now, your legacy.
It's a foundation, yourrevocable living trust, which is
great, which we know.
Revocable living trust don'thave asset protection inherently
, but they're a key part of yourlegacy, your estate and where
things go that we need thatpiece.
And then on the right sidewe're going to put your assets
and on the left side we're goingto put your operations.
(10:49):
And in a typical trifecta youmight have an S corporations for
your operations, or you andyour spouse, or you're flying
solo, have a W-2 day job.
That operation side will againlook unique to you.
And then on the asset sidethere'll be kind of an A-B piece
.
There's going to be an A pieceof your retirement accounts and
all this, and then the B part,kind of the after-tax piece like
(11:11):
what are you doing individually?
And so we want to build thatpicture and it could very easily
be one entity on the left, oneentity on the right.
Your entity for your assets isset up in the state where the
assets are.
Your name might be on a statewebsite, but you're protected
from the operations of thatrental property and it all flows
(11:32):
down.
That's typically what we do.
We have an LLC to protect youfrom the tenant.
You have an entity over here toprotect you from a customer and
you're going to make money, andit all flows down to your
revocable living trust.
Speaker 3 (11:43):
Then you start talking asset protection.
Yeah, and I think that layerone is really important and if
you have that rental property,we're going to recommend that
LLC to own that rental property,so that you contain that
liability there.
If you have the business, theoperational business, where you
might have customers oremployees or whatever it might
be, we want to contain theliability there.
(12:04):
We don't want tocross-contaminate.
Those entities don't own eachother.
The only connection of thosethings is you or your trust down
here that happens to own bothof them but they're not owning
each other and we'll see thatjacked up a lot too.
But let's talk about over onthat asset side too, the rental
property, for example.
Speaker 2 (12:20):
I like what you said there and I just want to kind of
add to it and I'll let you keepriffing this is good, is that
right there?
We're not talking about Wyoming.
We're not talking aboutDelaware, nevada.
We're saying where's yourrestaurant, where's your dental
business?
Where's your, where you operateas a realtor, manufacturer and
influencer?
Where do you live?
(12:41):
That's your operational entity.
And then where's your rentalproperty?
Oh, I got a rental property inTennessee, or I got one in
Georgia or Arizona or New Jersey.
Okay, so we have an entitythere.
Speaker 3 (12:51):
In that state where the property is yeah, that's
baseline.
Speaker 2 (12:56):
And does your trust own those?
Do you have a revocable livingtrust People?
Holy crap, if we can just get95% of our clients to have that
structure with good documents,with annual minutes, with the
proper ownership and titletransfer, yeah, if we can just
get that, that's assetprotection in and of itself.
Yeah, you're organized, you'reclean.
(13:16):
Then we can go to layer two.
Speaker 3 (13:19):
Yeah, but let me go to layer two, which I this might
not be, or this might be 1.1.
Speaker 2 (13:24):
I don't know, yeah, I like it.
You go, baby, we'll see.
Speaker 3 (13:26):
Okay, layer two I want to talk about.
Well, what if I have multipleassets over here?
What if I have three rentalproperties, matt Do I, and
they're all in Georgia.
You know it's a great market.
I've been investing there, Iknow it.
I got a good property manager,I got my team there, so I'm just
doubling down in that samemarket.
It's all in Georgia.
I got a Georgia LLC.
Should I put all three rentalsin the same LLC?
It depends on what we talkedabout earlier.
(13:48):
How much equity do you have?
What are we trying to protect?
If those three rentalproperties each have 10,000 of
equity, so you got total Great,let's put them in the same LLC.
Something happens on propertynumber one, they can sue the LLC
and they can get all of theequity, but in that case it's
only 30K.
But let's change the examplethere and say there's 200,000 of
(14:09):
equity in each of those threeproperties.
I don't want 600,000 ofpotential equity to be in one
LLC that if something happens onone property, all three are at
risk.
So we would set up a separateLLC in that scenario for
separate properties, becausethere's enough equity there.
And this is where it starts,depending on your situation of
how many LLCs you may have, youdon't need one for every
(14:30):
property unless you have a lotof equity in those properties.
I love it.
Speaker 2 (14:33):
I will want.
I do want to call that leveltwo.
I think I'm good with that,because level two is getting our
eggs in separate baskets.
I like that.
Speaker 1 (14:43):
We haven't even gone to Wyoming.
Speaker 2 (14:45):
We don't need an extra layer.
We just want to make sure thelayer we have at level one is
properly structured, and sostage two is really okay.
Do I need more entities there?
And again, are they in goodstanding?
Is the title where it'ssupposed to?
And people do not worry aboutmortgages and due on sale class.
We have set up 20, 30,000 LLCsin the last 20 plus years and I
(15:07):
think I can count on one handanytime a bank even asked what
the hell was going on.
Your mortgage has already beensold.
Keep paying the mortgagepayment, you're fine.
So we're going to move assetsaround as needed in stage two,
to just make sure you don't havetoo many eggs in one basket.
You're organized properly inthe right states, the ownership
is correct and, again, that's ahuge accomplishment for a lot of
(15:29):
people.
But they get excited with theoh my gosh, I need an entity in
Wyoming.
They jump over three steps andstages to go over here and set
it and they're still jacked upover here in level one.
So we want to take itprogressively, slowly and
carefully, and that would bethat next stage and that's where
I guess I want to say it now.
It's kind of a comprehensiveconsult.
(15:50):
Let's give everybody kind ofwhat this might look.
Can we digress for a minute?
Like what it would look like inthe process.
Speaker 3 (15:57):
I mean, really, this is where you need some tailored
advice in your situation andthat's where our lawyers help.
At KQS Lawyers, We've beendoing this for 20 years now,
helping clients, business owners, entrepreneurs, real estate
investors across the country.
Try to organize this, makesense of it and get an
actionable plan that helps themspecifically in their situation.
Speaker 2 (16:14):
And not break the bank.
Speaker 3 (16:15):
Yeah, and not to break the bank and have it done
with a real lawyer, okay and so.
But let me even just say, onthat layer too, just to see a
little more nuance to this youmight be in a state that allows
for series LLCs Mark mentionedTennessee that you might have
rental properties.
Maybe all your rentals are inTennessee.
Well, they allow for what'scalled a series LLC.
If I had those three rentals, Idon't need to do three separate
(16:37):
LLCs.
I could do one series LLC thattreats each separately and it
creates a series LLC.
You don't have to file to thestate.
They get separate assetprotection amongst the separate
properties.
Only one LLC filed at the stateand there's like 20 states that
fall into that.
But what if you're in the other30 states?
Well, it's a different littlestrategy and we dig into that as
one of many things as we'retrying to implement this for you
(16:58):
.
I love it.
Speaker 2 (16:59):
And on that digression, this is not an
infomercial.
Speaker 3 (17:02):
Yeah, it could be any lawyer that knows what they're
doing.
Speaker 2 (17:04):
Yeah yeah, no, I was going to say I thought you could
have said more, so I'm going tosay something too.
No, I just.
I want people to realize, whenyou start to get in this topic,
it can be overwhelming andyou're like, holy crap, my
lawyer doesn't think like this.
The only other place out thereis going to charge me 20 or 30
grand and they're selling stuffyou guys aren't even talking
about.
Where do I start?
And so I just want you to know.
(17:25):
There is an option, and we liketo build what's called a
comprehensive consultation, andthis plan is a trifecta.
The entry point is about twogrand.
If you've got a lot of stuffgoing on, the most you pay for
that comprehensive consult isaround five grand, and we're
going to build a plan.
You're going to meet with areal lawyer on Zoom you don't
have to be in your state withyou or face-to-face and they're
(17:47):
going to diagram this out, giveyou an action plan and answer a
lot of these questions and say,hey, yeah, this is where you
want to go, we can get there,but we're going to go here.
Then we're going to go here.
Here's what we would charge, andwe want to build a relationship
that makes sense financiallyand intellectually and
emotionally.
We want you to feel like you'renot getting taken advantage of
(18:07):
but, of course, feel like you'vejust found a new confidant, a
real advisor, and so I justwanted to bring that up again,
that, as we go to the nextstages in this and how technical
it could get, and we want youto know that you can always fall
back to okay, I'm ready for myappointment, I really am ready
to go there and I know I need todo some cleanup.
Speaker 3 (18:26):
Yeah, all right, so we've got to layer two.
Speaker 2 (18:29):
Yeah, I like layer two.
Speaker 3 (18:30):
Separate assets okay and separate treatment of
entities.
Speaker 2 (18:37):
I'll lay out layer three.
Matt, I've got about a milliondollars in equity.
I might have five to 10properties Ooh.
And I've got a big stockbrokerage account Ooh.
I've got a lot of equity in myhome.
I could live in a hard state.
That's like California or NewYork or Illinois, and I've got a
second home, maybe.
Yeah, and so now I'm like, whatwould you do?
Speaker 3 (18:52):
Well, we would want to look at what is your personal
risk?
Okay, because we could have ascenario where we're not talking
about a liability that happenson your rentals or a liability
in your business.
What if I get a liability ofMatt Sorensen?
I'm driving to the store to geta gallon of milk, you know.
Okay, the classic example thereget an accident, it could be
tragic, okay, and I get sued.
(19:13):
My insurance doesn't cover itor it only covers a certain
amount, and I got a milliondollar judgment against me and
the plaintiffs are like we wantto go collect on this.
Well, I want to limit them fromgetting it.
All of these assets that I'vebuilt, all of this, this equity
and this real estate that I'vebuilt, this empire I might have
my businesses, my brokerageaccount, my second home, even my
house, whatever it may be.
(19:34):
So how do I get that type ofprotection?
Do LLCs give me that protection?
Well, this is where peoplebring up Wyoming.
This is where you talk about acharging order protection entity
or a COPE, and what a COPEentity structure is and what
charging order is.
It says if you have a judgmentagainst you personally and a
plaintiff's lawyer is trying tocollect on that they can get
(19:56):
anything in your name.
So stuff in your bank accountcould be at risk.
Any assets in your personalname could be at risk.
But what if the vast majorityof my ownership is up in my
entities, in my real estate, forexample?
Well, I could have a WyomingLLC.
This is where Wyoming comes inall right as one of the options.
Not the only option Operating islike a holding entity.
So my trust would own myWyoming entity holding company
(20:19):
and that Wyoming entity owns myArizona LLC that owns my rental
in Arizona.
The reason being is they go upthe chain there because they're
like well, what does MattSorensen own?
He doesn't own an Arizona LLCthat owns a property.
He owns a Wyoming LLC.
The Wyoming LLC owns theArizona LLC.
So they got to start down herewhich Wyoming says we're not
going to let someone break upinto the LLC in that scenario to
(20:43):
get at the ownership, force thesale of the assets Some states
do.
By the way, some states willlet the plaintiff blow right
through that and make you forcethe sale of those assets in the
LLC.
Speaker 2 (20:51):
Wyoming, doesn't?
I love the way you explain thatand I'm going to say it another
way, so it might click for someof you too, in a different
manner, is that when you set upan LLC, it's to protect you from
the tenant.
That's in all 50 states.
That's a golden Done.
But when you get that liability, it's coming from the other
direction.
It's a two-way street when itcomes to asset protection.
(21:14):
So all 50 states protect youfrom the tenant as long as
you're not a slumlord and crazyand whatever.
But if you get a personalliability whatever it could be,
or even one of your teenagedrivers, who knows?
And now they come after you isthat LLC going to protect the
rental from you?
And so many clients over theyears are like well, of course
(21:34):
it does.
That's why I set up an LLC.
No, no, no, no, no.
We set up an LLC to protect youfrom the tenant, not to protect
the rental from you being anidiot.
Oh well, what states give methat protection?
Well, there's where we go tothe handy dandy trifecta 2025
calendar.
I've been doing these for fiveyears.
Matt collaborates with me onthis and I've got a sheet in
(21:57):
here I'm looking at it right nowthat says oh, in all 50 states,
which ones have seriesprotection?
Which ones have coat protection,which ones have privacy?
And you can start looking atthat going oh well, in Arizona,
oh, it's a different rule thanmaybe in California, and more
states are providing this coatprotection.
(22:18):
But they may say, well, it'sgot to be two members, not one
member, and we're not even aprivacy yet.
We're just saying which LLCwould protect me?
So if I'm in Arizona withrental properties, oh, they have
coat protection, okay, that'scool.
In what instance?
And this is where you don't wantto play lawyer You've got a
busy day job and you're likeokay, I get the concept and your
(22:40):
advisor helps walk you throughit and tailor it to you.
So I don't want to againoverwhelm you.
But this calendar you can buyon my website, marchaidcodercom.
It's like 30, 35 bucks, it'sgot all the tax deadlines for
the year, it's got all these funlittle tables and things like
that, and this helps you beequipped as an entrepreneur and
investor so that you can kind ofget a quick reference guide.
(23:00):
But anyway, the point is, asMatt says, you've got to look at
your state, the equity, whatyou're trying to accomplish, and
then we could add that COPEentity in between.
It really doesn't own anythingitself, it just owns the LLCs
you already have.
Speaker 3 (23:16):
Yeah, and that's a key point, do not put properties
or anything that run a businessout of this holding entity,
this COPE Wyoming entity.
It owns other companies.
It does not operate in and ofitself.
Speaker 2 (23:28):
Now, on that note, some of you may be going well,
how many states have COPE Rightnow?
Currently 22 states.
Some have a very clear statuteon this.
Some of them have case law.
Some of them say, well, is it atwo-member LLC or is it a
one-member LLC?
And this is where Wyoming haskind of risen to the top.
20 years ago, when I started asa lawyer, it was Nevada.
(23:50):
You go to Nevada, you know youcan hide out in Nevada, set up a
Nevada LLC and la la, la.
Well, nevada's kind of crushedthat in their legislature and
the fees there a lot.
It's kind of a pain in the butt.
Well, meanwhile, wyoming, kindof the sleeper state, said we're
going to give this a cleanstatute and they have kind of
this cool thing regarding thesingle member LLC.
Now, how would you explain that?
Speaker 3 (24:19):
Yeah, the one thing of what why Wyoming has caught
so much attention and a lot oflawyers do use it we think it's
been oversold, frankly, but wedo use it for a lot of clients
wanting this charging orderprotection is Wyoming does
specifically say in theirstatute that you get charging
order protection even if it's aone owner, single member, LLC,
even if Matt Sorenson owns ahundred percent of that Wyoming
holding company, this LLC, andMatt Sorensen's got a judgment
against him.
Some states say, hey, if it'sjust one person or even a
(24:40):
husband and wife that's got ajudgment against them and they
own an entity, we let them go inthere.
The whole thing of chargingorder protection in a lot of
states was to protect otherinnocent partners in an LLC or
entity.
So a lot of states said, ifit's just you or the person has
a judgment, we're going to letthem blow through the LLC and go
get in there and force a saleof assets.
Wyoming said, nah, we don'tcare, Even if that person that
(25:02):
owns it has a judgment againstthem.
It's just one, we're makingthem sit outside and they give
you that charging orderprotection.
So that's why we do like it andwhy you see it sold quite a bit
.
Speaker 2 (25:16):
So there is again this little dose of truth in
some of the stuff that'soversold.
Yeah, and at this juncture,when we're meeting with the
client, wyoming may be a greatfit.
Why we may not be a great fit,and so, but you get the concept
now.
Now I'm ready to drop the nextword in here privacy.
Is that okay?
Speaker 3 (25:29):
because some people are like what are we on here?
Yeah, seven layer burrito.
What is it is?
Speaker 2 (25:33):
that layer one.
You just get this number two.
Uh, look at your eggs in yourbaskets number three maybe at a
charging order stage four, maybesome privacy, okay.
so here's where someone says,okay, I've put on an extra
kevlar vest, I'm feeling alittle more protection, I got an
extra layer in there.
Doesn't give you carte blancheto go be an idiot again or be
(25:55):
fraudulent.
You want to always keep gooddocuments, good funding of
everything with proper titlingand tax returns match.
You're doing all those things.
Then you go.
You know what I don't like theworld seeing everything I got.
And if someone wants to comeafter me, I want to make it a
little harder for them to findme.
And privacy can add really apretty cool layer of protection
(26:17):
in the sense that it's even hardfor someone to find you.
But once they do that privacyis really out the door.
So you have to know it has itslimitations.
Well, here on our list we have10 states that have some form of
filing, an LLC where you don'thave to disclose the manager or
the member and it can be amoving target.
States you know, have their ownlittle filing process and some
(26:39):
are online, some are over thethrough the mail and la la la,
and our paralegals will say, oh,guess what, by the way, this
state does want this now andwhatever, but we've got some
good experience here on which 10states we could hide you as a
manager or a member and give yousome protection from a public
search.
Speaker 3 (26:59):
Yeah, yeah, and I think everybody's kind of got a
little different viewpoint onprivacy.
How important is it to them?
Because it's going to cost you.
There's additional fees addingin another entity here.
This could be this Wyomingentity that gives you some of
that layer three charging orderprotection too and additionally
it can give you some privacy.
We'll get into how that worksin the setup and how you can
(27:20):
structure that, but that's goingto cost you more.
So level one that we talk about,a lot of clients kind of end
there and that's a greatstarting point.
Maybe they have a business or aside hustle and they got a
rental property or two and we'rethere.
They got their trust.
They have a business or a sidehustle and they got a rental
property or two and we're there.
They got their trust.
They got the rental property onthe LLC.
A lot of clients are at leveltwo and they're like I have
multiple properties and theystay there.
(27:41):
Then the next client's at levelthree.
They're like I got a lot ofassets I've accumulated, I got a
million dollars or more of networth.
I'm worried about personalliability possibly and exposing
all my assets in my business ormy LLCs.
So now they get that chargingprotection.
Now we're at layer four andwe're like I need some privacy,
Like an example, just when I hada Grammy award-winning artist,
very famous you would know whoit is but I had to sign a
(28:02):
nondisclosure.
I can't say who it is.
Speaker 2 (28:04):
And you're a lawyer, so I'm like, so don't say their
name no-transcript.
Speaker 3 (28:22):
He's like that's the last thing I need and so, um,
and I think many of you feelthat way.
You know you might not have ahigh public profile, but you're
like I just don't want my nameout there.
I might have a lot of rentals,I might have a big business.
I just don't need it out therefloating everywhere and just for
publicity sake, floating aroundon the internet for someone to
(28:43):
chase down.
What assets do you have?
Plaintiff's lawyers being ableto see everything that you have
and all your entities?
Speaker 2 (28:48):
Yeah, and your brand, your social media presence.
All of a sudden someone sees alittle something.
They just want to make a bigdeal about it, and it's not a
big deal, but your name wasthere.
So, with privacy, we reallywant to again assess what you
want to keep private.
If you in my book, the Tax andLegal Playbook here and there's
(29:10):
a whole section on privacy wherewe also try to go through some
stages of how much privacy doyou really want or need for a
certain asset, you may say Idon't want anybody to know I own
this ranch or this farm.
Or I don't want anybody to knowI own a rental property in an
apartment building that mighthave some tough tenants that
need evicting.
But others are like but that'sit, I don't need people, I don't
(29:31):
care if someone knows where myhome is, or I don't care if they
know that I'm the president ofthis company or where my
personal address is.
Other people are like I got tobe off the grid.
Okay, that's going to beanother stage, and so we want to
kind of assess how much privacyyou need and want and start
giving you some price tags aswell as pain in the butt.
Speaker 3 (29:50):
Tag, yeah, and this is where I see some of the
structuring too, where we'llkind of take different opinions
on other people that are settingthis stuff up.
I'll see a lot of people usingthis holding company for their
operational entity and thenthey're using this Wyoming LLC
and they're using a Wyoming LLCfor their assets, and usually on
(30:10):
the asset side, if they gotenough, I'm like I get that
Charging order protection.
Maybe they're using it forprivacy too.
So the kids they'll use thatWyoming LLC as the member and
the manager, so it kind ofdiscloses any ownership on these
other LLCs in other States.
We can talk about that here ina second.
But there's there's great waysto get more privacy and it makes
sense on that side.
But on the operation side I'mlike, oh, you wanted privacy for
(30:33):
that operational business thatyour name's on the website as
the president and you go out andpromote yourself as the owner
of that business.
I'm like, what are we doingover?
Speaker 2 (30:42):
here yeah.
Speaker 3 (30:43):
And also that entity.
It's not designed to holdassets.
We have that entity tobasically receive income.
Push your income and revenueover to building assets on the
other side.
So I'm like I don't know thatit makes too much sense over
there.
I guess you could have value inthe business.
You may want to sell it one dayI could see some reasons for it
.
But we really like it more onthe asset side this Wyoming LLC
(31:04):
charging order protection toprotect someone from getting up
to your business assets, fromyour personal liability, and
then also creating more privacyon where your assets are.
Speaker 2 (31:20):
So that's a little more private and not out for
everyone to find on the internet.
I like it.
And another way I'd say it isif someone is trying to
recommend a Wyoming entity foreverything you know.
Like you need another entity forthis, you need another entity
for that or that it's going tosave you taxes, which it won't,
because it's where you're doingoperations and where the assets
live of, where you're going tobe taxed, not where the entity
is set up that holds it.
That could give great assetprotection, it could give great
privacy, but the IRS is like Ijust want to know where you're
(31:41):
doing business and our taxreturns are private At least
they should be.
We've heard lately that Dogehas uncovered a little bit of
some releases of tax returninformation, but the average
person does not have access toyour tax returns and we want to
be honest with the IRS.
This is another cautionarypoint.
We're not setting up theseentities to hide income or hide
(32:03):
from the IRS.
We're doing this to have a moreprivate life where we can be
protecting our brand, ourreputation, and not using it as
a license either to be a badperson.
Speaker 3 (32:13):
Yeah, but to take advantage of the laws that are
out there in your favor too,because there are laws, LLCs
right.
And corporation structures thatare, like created to limit your
liability.
That's what limited liabilitycompany stands for, so we can
use these tools and structure itright to benefit us.
There's nothing wrong with that, and we want you to do that, of
course.
Speaker 2 (32:41):
Like we want you to try to protect these assets
you're working so hard to build.
Let me give um, now I'm.
We could sit here for threehours literally and just give
some examples of some specificstrategies that would work.
And it's going to always dependon the types of assets, where
they're at, the equity involvedand what you're trying to
accomplish.
Blah, blah, blah.
And that's the reason whyyou're going to do a tailored,
comprehensive consult that'saffordable, to kind of start
that process and that journey.
But one example I'll just givekind of a fun one, matt and I
(33:03):
like this is, let's say, arizona.
It's actually one of the stateswhere there is terrible privacy
.
Arizona is a bad state forprivacy, although it might be
better for asset protection.
And see, that's something alawyer that's in the weeds every
day is going to help youidentify.
So in Arizona, when you file anLLC, you not only do you have
to list the manager, you alsohave to list any member that
(33:26):
owns 20% or more.
Even if it's your trust,another company or whatever.
You've got to disclose that.
And if there's a change inownership of anyone that owns
20% or more, you have to file anamendment.
So it's at the state.
Well, that's kind of a pain inthe butt, but I want privacy.
So what we might do is set upthat Wyoming entity that does
(33:47):
offer cope protection, as doesArizona, but that single
memberection yeah, pretty cool.
And so that entity can now bethe manager of your Arizona LLC
and also the owner of yourArizona LLC.
So when someone does a publicsearch and says who owns that
apartment building on ScottsdaleRoad and Thomas, oh well, xyz
(34:10):
LLC.
Okay, let's go look at it.
Oh, and a Wyoming LLC is themanager and the owner, let's go
to the Wyoming website and we goover to there, the Wyoming
website, and they're like I wantto know who owns this thing,
damon, oh, it's a law firm thatset it up, that's all I know.
Dang it.
So now it requires a subpoenaand a judge to tell us.
(34:32):
We have to disclose that.
Speaker 3 (34:34):
Which would be very.
You'd have to have donesomething very nasty for us to
be able to have to disclose that, because at least with us it's
attorney-client privilege.
With some non-lawyer that setit up, there's no argument that
they don't have to disclose that.
Okay, so that's anotherdifference of working with an
actual, real lawyer.
So we're not just TV lawyers,we're real lawyers.
You know, it's not just twogood looking guys that could
(34:55):
have been on suits, right, youknow.
Speaker 2 (34:57):
I'd stayed at a holiday in last night, which
gives me even more superpower.
Speaker 3 (35:00):
So, yeah, yeah, that's a throwback joke that's
like a 15 year old one.
Speaker 1 (35:04):
They don't do that anymore.
Speaker 3 (35:05):
They don't know.
I stayed at a holiday in lastnight.
Speaker 2 (35:17):
I don't.
Speaker 3 (35:17):
I like that, old enough to know that joke.
Oh my gosh, I am so old.
Okay, well, there was acommercial that said Our demo,
actually, you know, probably getit, got it.
Speaker 2 (35:21):
I'll say that, yeah, the commercial was if you stayed
at a Holiday Inn Express,you're going to work faster,
move faster the next day and beincredible, and so I think it
was a great commercial.
Speaker 3 (35:28):
I thought it was too.
I was just saying it's a little, you know, it's dated, it's
dated.
Speaker 2 (35:33):
Well, hopefully, my example, guys.
It gives you a little, you know, wets your whistle a little of
okay, this is what we're tryingto do and the lawyer is going to
help identify the strategy.
Tell me the cost how much is itgoing to be to implement and
maintain and then you can makean educated decision.
Bottom line there should be nofear.
There should be no fear.
There should be no pressure.
(35:54):
There should be a visualrepresentation of what you're
doing that makes senseintellectually and emotionally
and your accountant is going tobe able to carry out the order
of doing your tax work withoutconflicting what the lawyer says
.
And they're on the same team.
And that's why we've built anetwork of tax advisors and
train over a thousand taxadvisors in a network that are
(36:16):
trained by us and you pay themseparately.
We don't make any money on that, and they're going to work with
the lawyer to help implementwhat you need.
And so I don't know.
I just wanted to give thatexample of what it might look
like.
Speaker 3 (36:26):
Yeah.
So we want you to haveconfidence going through this.
Whenever you set up, we wantyou to feel confident about it
so you don't have to worry aboutthat.
Go worry about making moremoney.
That's what you're good at,okay.
Don't try to do this yourselfor set it up online or work with
people that don't know whatthey're doing.
Like, get it done right, get itset.
Work with the team that you canadd and build on it as you need
(36:47):
.
Make changes too.
Sometimes you got a life change.
You might have a significantamount of assets come in, or a
different income year or troubleon the horizon.
That's what we're here for,okay.
We want to be here to help youthrough all those challenges and
the opportunities that areheavy.
Speaker 2 (37:02):
I will say this, and I know you didn't mean this, but
with the words you used, Idon't want someone to think set
it, forget it.
We don't want that.
Speaker 3 (37:09):
Yeah Well.
I'm saying it's like haveconfidence in what you said so
you don't have to worry about.
Did I these idiots that I hiredthat aren't lawyers do what?
Did they actually know whatthey were doing?
Speaker 2 (37:17):
Yeah, and but I?
What I mean by that, too, is Iwant you to understand it.
You, you are.
You may be using us as aquarterback, but you're the
owner of the team and what I'dlove for you to do is have that
visual representation and takeit into your family board
meeting and you explain it tothe family.
And if you can't explain whysomething owns something or why
it's there, you need to get backto that consultation and go.
(37:39):
Why did I do this again?
Because you want to at leastunderstand the why, and we're
going to do the work in theweeds and I think it's going to
give you so much confidence andreally be the leader of your
family board meetings and teachyour family about this.
Speaker 3 (37:53):
Yeah, we're part of your team, all right, but you're
leading the team.
You let us know where we canhelp.
We're going to provide ouradvice and expertise and want to
add value to you, of course andwhether that's us or someone
else too this is not meant to be.
We want to give you guidelinesand information.
We got a busy team.
We want to help you.
We love it, but get that good,solid advice.
This is a critical component ofhow you build and grow wealth
(38:13):
is making sure you protect it.
This is defense.
Speaker 2 (38:16):
Yeah, and we talked a lot about asset protection.
I do want to say a couple morewords about privacy.
If this is something that'sreally interesting to you, first
of all, in my tax and legalplaybook pick it up on Amazon
audiobook as well there's awhole section that takes you
through these more extremelayers of privacy setting up
ghost addresses, mail forwarding, which is a service we provide
(38:36):
we would if you want to go offthe grid and not share your
personal address.
How do you get there?
And so check out that sectionon privacy.
Also, I love JJ Luna, probablyone of the industry leaders in
personal privacy protection.
He's an older guy now.
I've interviewed him, man, overthe last 15 years on occasion
on our Main Street podcast andhis books are excellent.
(38:57):
So I'd check out JJ Luna, andonce you get into that genre,
you're going to see some otherauthors that have different ways
of looking at the privacy.
But I just encourage you toalways think of the cost-benefit
analysis.
What does this really mean?
Because if you can't share yourpersonal address, what are you
doing when you go open a newaccount somewhere or register at
(39:18):
a hotel and travel, and it getspretty unique.
You know, you think of JackReacher or Jason Bourne, and
those shows are fun, you knowwhere.
No one knows where they're ator who they are.
But it comes with a cost.
Speaker 3 (39:33):
Yeah, yeah, it takes that If you've got a family and
a real home.
Life and people in school andstuff is a little different to
try to do those gymnastics.
But privacy could be veryreasonable in many aspects of
your assets.
Speaker 2 (39:46):
Yeah, for your assets , and that doesn't have to be
everybody's business Veryachievable.
Speaker 3 (39:51):
We can do with some LLC structuring, understanding
the right states, implementingsomething specific for your
situation.
I love that note you had on theaddresses too, of course, like
we've got a service in oursister company, Main Street
Business Services, where weprovide a virtual address and
privacy address type service tomake sure that your address
stays off of any documents.
Yeah.
Speaker 2 (40:11):
All right.
Well, hopefully this has beeninformative and help you feel
more equipped to make somecareful decisions, because this
can get expensive and wheneverit sounds too good to be true,
get this second opinion.
You're going to be spending alot of money and time over the
next years to maintain andimplement this.
Making sure you get a coupleopinions on the outset will
(40:33):
really help you in the long runby far.
So thanks for listening.
So grateful to be a part ofyour lives, and if you've
enjoyed this podcast, pleaseshare it and give us a two
thumbs up.
Five stars, 10 out of 10, highfives, whatever it takes.
We appreciate you being aregular listener and we'll see
you next week.
I think open forum is going tobe next week.
Speaker 3 (40:54):
Yeah, we need to do some open forum.
So if you've got questions, getover to MainStreetBusinesscom,
submit your questions there.
Mark and I will be goingthrough them and we'll give you
answers.
So be there, we'll see you nexttime.
Thanks everyone.
Welcome to the Main Street Business Podcast with
your distinguished hosts, mark JKohler and Matt Sorenson.
Both are best-selling authorsand have over 25 years of
industry experience, with 10,000client consultations, making
them the leading tax and legalexperts in the nation.
Together, they'll unpack themost complex tax, legal and
financial strategies crucial forsaving more, stressing less and
(00:23):
building generational wealth.
Today they're your personaladvisors, ready to break it down
for you and make the tax andlegal game easier than ever.
Speaker 2 (00:33):
Here is Mark and Matt .
We're doing this to have a moreprivate life where we can be
protecting our brand, ourreputation.
Speaker 3 (00:39):
I had a Grammy award-winning artist, very
famous you would know who it isand they were very concerned
about privacy.
When we up the llc and we usethis structure we're talking
about here, you might not have ahigh public profile, but you're
like I just don't want my nameout there.
Speaker 2 (00:52):
I just don't need it out there floating everywhere,
yeah, and your brand, yoursocial media presence.
All of a sudden, someone sees alittle something.
They just want to make a bigdeal about it, and it it's not a
big deal, but your name wasthere.
Bottom line.
There should be no fear.
There should be no pressure.
We're not just TV lawyers.
Speaker 3 (01:07):
We're real lawyers.
It's not just two good lookingguys.
Speaker 2 (01:09):
We could have been on suits Right.
Speaker 3 (01:12):
Welcome everyone to the Main Street Business Podcast
.
This is Matt Sorensen, joinedby the incredible Mark J Kohler.
We're excited to be with youtoday because we want to talk
about keeping the money and allthe hard-earned assets that
you've built up.
Speaker 2 (01:24):
Yeah, and I think the topic that goes hand in hand
with that that I've been sovocal about over the last 25
years is also making sure youdon't get scammed and sold crap
you don't need.
There is so much out there inthis asset protection industry
of you need a Wyoming entity oryou need a Nevada entity or
Delaware, and you can hide andoh, get in your vocal trust and
(01:45):
go offshore and you know, andthere's just so much crap out
there too.
So we want to be a voice ofreason, give you some straight
answers today on what works,what doesn't, how to take action
and what it might cost, andthen you're more well-equipped
to go out and choose theprofessional you need.
Speaker 3 (02:01):
Yeah, and I hate to say it, but every bad idea and
recommendation out there has alittle dose of truth in it and
it's kind of built off of thatand then overdone.
So we want to talk about whatshould you actually be doing?
It might be different in yoursituation.
We'll try to give you someguidelines here about what may
work and make sense for you, butat the end of the day, you want
this to be tailored to yoursituation.
Okay, so we're going to comeback to that towards the end.
Speaker 2 (02:23):
So the main goal here is let's bring this in from
30,000 feet down to 2010.
We're going to land this babysafely with all the FAA stuff
going on.
Oh my gosh, so 30,000 foot view.
A lot of people are like okay,I'm buying rental real estate,
I'm investing in the market.
Okay, I'm buying rental realestate, I'm investing in the
(02:43):
market, I've got XYZ assets.
I want protection If somethinggoes wrong.
I'm driving a car, my teenagersare driving, there's a lawsuit
that comes after me or insideone of those operations.
And number two I'd like alittle more privacy.
With the web and transparencyout there and Siri listening to
everything I'm doing, I justfeel like I could use a little
(03:06):
more privacy, because it's alayer of protection, but it's
not protection itself.
I call it the camouflage.
So what we're really lookingfor is kind of that bulletproof
vest that'll help you to somedegree.
That's asset protection.
That's asset protection.
And then the camouflage thatwill help you just be a little
less noticed.
And if I'm going to go intocombat, I want both, and that's
(03:28):
what we're going to talk aboutas we zoom in here.
Speaker 3 (03:30):
Yeah, and everybody might be a little different here
, okay.
So once you just keep that inmind here as we're talking
through this.
The other thing I want you tothink about is two other
overriding considerations here.
One is taxes.
We want to make sure we'redoing this in a tax efficient
way.
We definitely don't want astructure that's going to cost
us more in taxes, so I make surewe're doing it in a tax
efficient way, maybe evenconsidering audit risk too.
There's a couple ideas therewe'll have for you.
(03:52):
And the other thing is yourcost and administrative burden.
A lot of times we'll see stuffthat gets set up for people and
we're like you're a dentist withone rental property.
What do you need 20 LLCs for?
I mean, I hate to say it, butyou got oversold here.
You don't need all this crap,not just because of the cost it
took to set it up, because ofthe cost to maintain it.
Speaker 2 (04:13):
Yeah, and I want to be very this is.
This is peeling away the onion,pulling back the curtain.
You're going to see wizard ofOz, right here is what what
certain law firms even there's alot of promoters out there that
don't even have the legallicense to sell a lot of their
asset protection and crap butwhat a lot of times they'll do
is say, okay, so let me put itthis way A client comes in and
(04:36):
they've got this elaboratestructure, just like Matt said,
they could be any sort ofprofession, they've got way more
than they need and they're on apath.
But we're like, holy crap, thisis a lot of work and it cost
them a lot.
And the reason why it happenedis these companies or firms that
promote this will say, well,this is where you want to go, so
(04:58):
let's set up the structure soyou have it when you get there.
And a lot of buyers, consumers,business owners, investors, like
you maybe, are like yes, I wantto have what I need, so when I
get there, it's already good togo.
I understand that and I want tobe sensitive to that.
But it's expensive and youdon't need it.
(05:19):
I don't go out and buy a pairof jeans that I can't fit into
right now, it's a waste of money.
And buy a pair of jeans that Ican't fit into right now, it's a
waste of money.
Now, if I work out and I'm onmy diet and la, la, la, okay,
then I go out and buy that pairof jeans and that's how we feel.
Let's not overdo it, let's notbuy more than we need right now
and we can build on a properstructure.
But I just wanted to recognize,I think, why people get there
(05:42):
and again, it's that sliver oftruth that gets exploited, yeah,
so let's talk about your firstconsideration.
Speaker 3 (05:48):
As you're thinking about this, if we're going to
build asset protection and let'smaybe start there, we'll come
to privacy here in a momentwe're thinking asset protection.
We first need to think what arewe protecting?
What assets do I have?
Do I have?
a significant amount of assets.
Yes, right now.
Now you at least might have apaycheck, a W-2, maybe income
from your business you don'twant that garnished.
Even your bank account, rightthat you might have even some
(06:11):
day-to-day money or maybe somesavings.
Your retirement accounts areotherwise typically protected,
so we don't need to haveentities for those.
You can file bankruptcy andstill keep your Roth IRAs and
your retirement accounts.
Speaker 2 (06:23):
And in a lot of states your home could have
homestead protection and a lotof things.
Speaker 3 (06:26):
You get a homestead exemption in your state.
There's certain limits thatcould be.
Some states have a lot, somestates have a little.
So you might want to look thatup and Mark's got a guide in his
book.
It's even in his calendar Ifyou want to look that up.
Those details we got on oursite as well.
But I want you to just focus inand think about that.
What do I have?
Maybe I do have a significantbrokerage account, a lot of real
estate that I own, some land, asecond home, other businesses.
(06:50):
I want to protect those thingsfrom other incidents that could
happen in other places of mylife.
The more of that you have, themore asset protection you need.
Speaker 2 (06:59):
You know and we've talked about this in one of our
other podcasts when you'restarting to work with your
retirement accounts, doing aninventory but I think this is a
great opportunity to say thisnow If you are concerned about
asset protection and privacy, Iwant to see your financial
statement, I want to see yourbalance sheet and it's
attorney-client privilege.
You should be working with anattorney on this process,
obviously, but sometimes clientscome in and say I need asset
(07:21):
protection.
Well, what do you got?
Well, I got this, or well, Igot that.
Well, what entity do you have?
Well, I think I set one up overhere and I think I've got.
Okay, why don't you do aninventory first?
And you're going to feel morein control.
You're going to feel morestrong or weak based on what
that looks like, and we want tomake sure that we are making
good decisions based on correctdata.
(07:42):
And so I think step one in thisprocess too especially before
you even get on a call with oneof our attorneys, for example is
have at least a list what arethe fair market values and what
are the mortgages or debtsagainst those, and what's your
equity?
Because if you've got a lot ofassets but they're leaned to the
hill.
Okay, we're looking at the netexposure, not the fair market
(08:05):
value.
Speaker 3 (08:05):
Exactly, and I think when we do, and I think when
you're working with any lawyerhere, you can work with our
amazing team at KQS Lawyers.
But I'm just saying here, whatthey should be doing is taking
that inventory to know whatassets am I trying to protect.
We're going to have differentstructures depending on what
type of the assets we're tryingto protect.
Or we might not need anystructure, For example, if all
your money's in retirementaccounts or something like that,
or we can do very limitedthings.
(08:27):
The other thing I want to wewant to look at is your actual
tax return.
Okay, we want to look at yourtax return and see how are you
reporting income?
Where are assets showing up onyour tax return?
Sometimes there's tax andplanning opportunities.
You don't want to do some assetprotection planning, which we
see all over the place thatjacks up your taxes and now
you're paying more taxes becausesome idiot didn't understand
tax law.
But they thought they created agreat asset protection plan, so
(08:49):
it's got to be coordinated theydo, and I love where you went
with this.
Speaker 2 (08:52):
And, by the way, we're going to give you some
practical.
What does this look liketypically and what would you do?
Next steps here in a moment.
But this mindset andperspective is so important
because you want to be alignedon what you're trying to
accomplish and know what youhave and where you're going.
So I just want to piggybackwhat you just said too.
It's not always, yes, you wantto make sure you're not
undermining your tax planning orwhatever, but a lot of times we
(09:14):
look at your tax return andwe're like yeah, that's not what
your asset plan says.
Because to me, a tax return islike your blood work.
You're like, oh, I hurt here, Ifeel bad, I've got all this
stuff, I've got all this.
Really, I just looked at yourblood work, that's not the
problem, it's over here.
And another way of saying it isjust, does your tax return
(09:36):
reflect your legal structure?
Because if it doesn't, nowyou've got issues, but
potentially an audit, and if youget into a lawsuit, this is
what plaintiff attorneys want todo.
They're like this guy says thisis what he's doing.
That's not what he's doing,because your tax return tells
the true tale.
Speaker 3 (09:52):
Yeah, yeah, it can be discoverable and you sign it
under penalty of perjury.
So trying to backtalk that withany lawyer when you're on the
stand and like a penalty ofperjury, you did sign that, so
were you lying then?
Are you lying now, sir?
That's the question.
Are you lying to?
Speaker 2 (10:08):
the IRS or you're lying to me.
Uh well, I thought myaccountant knew this.
I thought my lawyer and this isa problem too is you work with
a lawyer that doesn't understandtaxes and that's not going to
help.
So can I say this Now let's getpractical, let's get baseline,
and what we do with all of ourclients when we start this
process is we build what we calla trifecta.
(10:29):
We want to have a visualrepresentation of what you have
now, your legacy.
It's a foundation, yourrevocable living trust, which is
great, which we know.
Revocable living trust don'thave asset protection inherently
, but they're a key part of yourlegacy, your estate and where
things go that we need thatpiece.
And then on the right sidewe're going to put your assets
and on the left side we're goingto put your operations.
(10:49):
And in a typical trifecta youmight have an S corporations for
your operations, or you andyour spouse, or you're flying
solo, have a W-2 day job.
That operation side will againlook unique to you.
And then on the asset sidethere'll be kind of an A-B piece
.
There's going to be an A pieceof your retirement accounts and
all this, and then the B part,kind of the after-tax piece like
(11:11):
what are you doing individually?
And so we want to build thatpicture and it could very easily
be one entity on the left, oneentity on the right.
Your entity for your assets isset up in the state where the
assets are.
Your name might be on a statewebsite, but you're protected
from the operations of thatrental property and it all flows
(11:32):
down.
That's typically what we do.
We have an LLC to protect youfrom the tenant.
You have an entity over here toprotect you from a customer and
you're going to make money, andit all flows down to your
revocable living trust.
Speaker 3 (11:43):
Then you start talking asset protection.
Yeah, and I think that layerone is really important and if
you have that rental property,we're going to recommend that
LLC to own that rental property,so that you contain that
liability there.
If you have the business, theoperational business, where you
might have customers oremployees or whatever it might
be, we want to contain theliability there.
(12:04):
We don't want tocross-contaminate.
Those entities don't own eachother.
The only connection of thosethings is you or your trust down
here that happens to own bothof them but they're not owning
each other and we'll see thatjacked up a lot too.
But let's talk about over onthat asset side too, the rental
property, for example.
Speaker 2 (12:20):
I like what you said there and I just want to kind of
add to it and I'll let you keepriffing this is good, is that
right there?
We're not talking about Wyoming.
We're not talking aboutDelaware, nevada.
We're saying where's yourrestaurant, where's your dental
business?
Where's your, where you operateas a realtor, manufacturer and
influencer?
Where do you live?
(12:41):
That's your operational entity.
And then where's your rentalproperty?
Oh, I got a rental property inTennessee, or I got one in
Georgia or Arizona or New Jersey.
Okay, so we have an entitythere.
Speaker 3 (12:51):
In that state where the property is yeah, that's
baseline.
Speaker 2 (12:56):
And does your trust own those?
Do you have a revocable livingtrust People?
Holy crap, if we can just get95% of our clients to have that
structure with good documents,with annual minutes, with the
proper ownership and titletransfer, yeah, if we can just
get that, that's assetprotection in and of itself.
Yeah, you're organized, you'reclean.
(13:16):
Then we can go to layer two.
Speaker 3 (13:19):
Yeah, but let me go to layer two, which I this might
not be, or this might be 1.1.
Speaker 2 (13:24):
I don't know, yeah, I like it.
You go, baby, we'll see.
Speaker 3 (13:26):
Okay, layer two I want to talk about.
Well, what if I have multipleassets over here?
What if I have three rentalproperties, matt Do I, and
they're all in Georgia.
You know it's a great market.
I've been investing there, Iknow it.
I got a good property manager,I got my team there, so I'm just
doubling down in that samemarket.
It's all in Georgia.
I got a Georgia LLC.
Should I put all three rentalsin the same LLC?
It depends on what we talkedabout earlier.
(13:48):
How much equity do you have?
What are we trying to protect?
If those three rentalproperties each have 10,000 of
equity, so you got total Great,let's put them in the same LLC.
Something happens on propertynumber one, they can sue the LLC
and they can get all of theequity, but in that case it's
only 30K.
But let's change the examplethere and say there's 200,000 of
(14:09):
equity in each of those threeproperties.
I don't want 600,000 ofpotential equity to be in one
LLC that if something happens onone property, all three are at
risk.
So we would set up a separateLLC in that scenario for
separate properties, becausethere's enough equity there.
And this is where it starts,depending on your situation of
how many LLCs you may have, youdon't need one for every
(14:30):
property unless you have a lotof equity in those properties.
I love it.
Speaker 2 (14:33):
I will want.
I do want to call that leveltwo.
I think I'm good with that,because level two is getting our
eggs in separate baskets.
I like that.
Speaker 1 (14:43):
We haven't even gone to Wyoming.
Speaker 2 (14:45):
We don't need an extra layer.
We just want to make sure thelayer we have at level one is
properly structured, and sostage two is really okay.
Do I need more entities there?
And again, are they in goodstanding?
Is the title where it'ssupposed to?
And people do not worry aboutmortgages and due on sale class.
We have set up 20, 30,000 LLCsin the last 20 plus years and I
(15:07):
think I can count on one handanytime a bank even asked what
the hell was going on.
Your mortgage has already beensold.
Keep paying the mortgagepayment, you're fine.
So we're going to move assetsaround as needed in stage two,
to just make sure you don't havetoo many eggs in one basket.
You're organized properly inthe right states, the ownership
is correct and, again, that's ahuge accomplishment for a lot of
(15:29):
people.
But they get excited with theoh my gosh, I need an entity in
Wyoming.
They jump over three steps andstages to go over here and set
it and they're still jacked upover here in level one.
So we want to take itprogressively, slowly and
carefully, and that would bethat next stage and that's where
I guess I want to say it now.
It's kind of a comprehensiveconsult.
(15:50):
Let's give everybody kind ofwhat this might look.
Can we digress for a minute?
Like what it would look like inthe process.
Speaker 3 (15:57):
I mean, really, this is where you need some tailored
advice in your situation andthat's where our lawyers help.
At KQS Lawyers, We've beendoing this for 20 years now,
helping clients, business owners, entrepreneurs, real estate
investors across the country.
Try to organize this, makesense of it and get an
actionable plan that helps themspecifically in their situation.
Speaker 2 (16:14):
And not break the bank.
Speaker 3 (16:15):
Yeah, and not to break the bank and have it done
with a real lawyer, okay and so.
But let me even just say, onthat layer too, just to see a
little more nuance to this youmight be in a state that allows
for series LLCs Mark mentionedTennessee that you might have
rental properties.
Maybe all your rentals are inTennessee.
Well, they allow for what'scalled a series LLC.
If I had those three rentals, Idon't need to do three separate
(16:37):
LLCs.
I could do one series LLC thattreats each separately and it
creates a series LLC.
You don't have to file to thestate.
They get separate assetprotection amongst the separate
properties.
Only one LLC filed at the stateand there's like 20 states that
fall into that.
But what if you're in the other30 states?
Well, it's a different littlestrategy and we dig into that as
one of many things as we'retrying to implement this for you
(16:58):
.
I love it.
Speaker 2 (16:59):
And on that digression, this is not an
infomercial.
Speaker 3 (17:02):
Yeah, it could be any lawyer that knows what they're
doing.
Speaker 2 (17:04):
Yeah yeah, no, I was going to say I thought you could
have said more, so I'm going tosay something too.
No, I just.
I want people to realize, whenyou start to get in this topic,
it can be overwhelming andyou're like, holy crap, my
lawyer doesn't think like this.
The only other place out thereis going to charge me 20 or 30
grand and they're selling stuffyou guys aren't even talking
about.
Where do I start?
And so I just want you to know.
(17:25):
There is an option, and we liketo build what's called a
comprehensive consultation, andthis plan is a trifecta.
The entry point is about twogrand.
If you've got a lot of stuffgoing on, the most you pay for
that comprehensive consult isaround five grand, and we're
going to build a plan.
You're going to meet with areal lawyer on Zoom you don't
have to be in your state withyou or face-to-face and they're
(17:47):
going to diagram this out, giveyou an action plan and answer a
lot of these questions and say,hey, yeah, this is where you
want to go, we can get there,but we're going to go here.
Then we're going to go here.
Here's what we would charge, andwe want to build a relationship
that makes sense financiallyand intellectually and
emotionally.
We want you to feel like you'renot getting taken advantage of
(18:07):
but, of course, feel like you'vejust found a new confidant, a
real advisor, and so I justwanted to bring that up again,
that, as we go to the nextstages in this and how technical
it could get, and we want youto know that you can always fall
back to okay, I'm ready for myappointment, I really am ready
to go there and I know I need todo some cleanup.
Speaker 3 (18:26):
Yeah, all right, so we've got to layer two.
Speaker 2 (18:29):
Yeah, I like layer two.
Speaker 3 (18:30):
Separate assets okay and separate treatment of
entities.
Speaker 2 (18:37):
I'll lay out layer three.
Matt, I've got about a milliondollars in equity.
I might have five to 10properties Ooh.
And I've got a big stockbrokerage account Ooh.
I've got a lot of equity in myhome.
I could live in a hard state.
That's like California or NewYork or Illinois, and I've got a
second home, maybe.
Yeah, and so now I'm like, whatwould you do?
Speaker 3 (18:52):
Well, we would want to look at what is your personal
risk?
Okay, because we could have ascenario where we're not talking
about a liability that happenson your rentals or a liability
in your business.
What if I get a liability ofMatt Sorensen?
I'm driving to the store to geta gallon of milk, you know.
Okay, the classic example thereget an accident, it could be
tragic, okay, and I get sued.
(19:13):
My insurance doesn't cover itor it only covers a certain
amount, and I got a milliondollar judgment against me and
the plaintiffs are like we wantto go collect on this.
Well, I want to limit them fromgetting it.
All of these assets that I'vebuilt, all of this, this equity
and this real estate that I'vebuilt, this empire I might have
my businesses, my brokerageaccount, my second home, even my
house, whatever it may be.
(19:34):
So how do I get that type ofprotection?
Do LLCs give me that protection?
Well, this is where peoplebring up Wyoming.
This is where you talk about acharging order protection entity
or a COPE, and what a COPEentity structure is and what
charging order is.
It says if you have a judgmentagainst you personally and a
plaintiff's lawyer is trying tocollect on that they can get
(19:56):
anything in your name.
So stuff in your bank accountcould be at risk.
Any assets in your personalname could be at risk.
But what if the vast majorityof my ownership is up in my
entities, in my real estate, forexample?
Well, I could have a WyomingLLC.
This is where Wyoming comes inall right as one of the options.
Not the only option Operating islike a holding entity.
So my trust would own myWyoming entity holding company
(20:19):
and that Wyoming entity owns myArizona LLC that owns my rental
in Arizona.
The reason being is they go upthe chain there because they're
like well, what does MattSorensen own?
He doesn't own an Arizona LLCthat owns a property.
He owns a Wyoming LLC.
The Wyoming LLC owns theArizona LLC.
So they got to start down herewhich Wyoming says we're not
going to let someone break upinto the LLC in that scenario to
(20:43):
get at the ownership, force thesale of the assets Some states
do.
By the way, some states willlet the plaintiff blow right
through that and make you forcethe sale of those assets in the
LLC.
Speaker 2 (20:51):
Wyoming, doesn't?
I love the way you explain thatand I'm going to say it another
way, so it might click for someof you too, in a different
manner, is that when you set upan LLC, it's to protect you from
the tenant.
That's in all 50 states.
That's a golden Done.
But when you get that liability, it's coming from the other
direction.
It's a two-way street when itcomes to asset protection.
(21:14):
So all 50 states protect youfrom the tenant as long as
you're not a slumlord and crazyand whatever.
But if you get a personalliability whatever it could be,
or even one of your teenagedrivers, who knows?
And now they come after you isthat LLC going to protect the
rental from you?
And so many clients over theyears are like well, of course
(21:34):
it does.
That's why I set up an LLC.
No, no, no, no, no.
We set up an LLC to protect youfrom the tenant, not to protect
the rental from you being anidiot.
Oh well, what states give methat protection?
Well, there's where we go tothe handy dandy trifecta 2025
calendar.
I've been doing these for fiveyears.
Matt collaborates with me onthis and I've got a sheet in
(21:57):
here I'm looking at it right nowthat says oh, in all 50 states,
which ones have seriesprotection?
Which ones have coat protection,which ones have privacy?
And you can start looking atthat going oh well, in Arizona,
oh, it's a different rule thanmaybe in California, and more
states are providing this coatprotection.
(22:18):
But they may say, well, it'sgot to be two members, not one
member, and we're not even aprivacy yet.
We're just saying which LLCwould protect me?
So if I'm in Arizona withrental properties, oh, they have
coat protection, okay, that'scool.
In what instance?
And this is where you don't wantto play lawyer You've got a
busy day job and you're likeokay, I get the concept and your
(22:40):
advisor helps walk you throughit and tailor it to you.
So I don't want to againoverwhelm you.
But this calendar you can buyon my website, marchaidcodercom.
It's like 30, 35 bucks, it'sgot all the tax deadlines for
the year, it's got all these funlittle tables and things like
that, and this helps you beequipped as an entrepreneur and
investor so that you can kind ofget a quick reference guide.
(23:00):
But anyway, the point is, asMatt says, you've got to look at
your state, the equity, whatyou're trying to accomplish, and
then we could add that COPEentity in between.
It really doesn't own anythingitself, it just owns the LLCs
you already have.
Speaker 3 (23:16):
Yeah, and that's a key point, do not put properties
or anything that run a businessout of this holding entity,
this COPE Wyoming entity.
It owns other companies.
It does not operate in and ofitself.
Speaker 2 (23:28):
Now, on that note, some of you may be going well,
how many states have COPE Rightnow?
Currently 22 states.
Some have a very clear statuteon this.
Some of them have case law.
Some of them say, well, is it atwo-member LLC or is it a
one-member LLC?
And this is where Wyoming haskind of risen to the top.
20 years ago, when I started asa lawyer, it was Nevada.
(23:50):
You go to Nevada, you know youcan hide out in Nevada, set up a
Nevada LLC and la la, la.
Well, nevada's kind of crushedthat in their legislature and
the fees there a lot.
It's kind of a pain in the butt.
Well, meanwhile, wyoming, kindof the sleeper state, said we're
going to give this a cleanstatute and they have kind of
this cool thing regarding thesingle member LLC.
Now, how would you explain that?
Speaker 3 (24:19):
Yeah, the one thing of what why Wyoming has caught
so much attention and a lot oflawyers do use it we think it's
been oversold, frankly, but wedo use it for a lot of clients
wanting this charging orderprotection is Wyoming does
specifically say in theirstatute that you get charging
order protection even if it's aone owner, single member, LLC,
even if Matt Sorenson owns ahundred percent of that Wyoming
holding company, this LLC, andMatt Sorensen's got a judgment
against him.
Some states say, hey, if it'sjust one person or even a
(24:40):
husband and wife that's got ajudgment against them and they
own an entity, we let them go inthere.
The whole thing of chargingorder protection in a lot of
states was to protect otherinnocent partners in an LLC or
entity.
So a lot of states said, ifit's just you or the person has
a judgment, we're going to letthem blow through the LLC and go
get in there and force a saleof assets.
Wyoming said, nah, we don'tcare, Even if that person that
(25:02):
owns it has a judgment againstthem.
It's just one, we're makingthem sit outside and they give
you that charging orderprotection.
So that's why we do like it andwhy you see it sold quite a bit
.
Speaker 2 (25:16):
So there is again this little dose of truth in
some of the stuff that'soversold.
Yeah, and at this juncture,when we're meeting with the
client, wyoming may be a greatfit.
Why we may not be a great fit,and so, but you get the concept
now.
Now I'm ready to drop the nextword in here privacy.
Is that okay?
Speaker 3 (25:29):
because some people are like what are we on here?
Yeah, seven layer burrito.
What is it is?
Speaker 2 (25:33):
that layer one.
You just get this number two.
Uh, look at your eggs in yourbaskets number three maybe at a
charging order stage four, maybesome privacy, okay.
so here's where someone says,okay, I've put on an extra
kevlar vest, I'm feeling alittle more protection, I got an
extra layer in there.
Doesn't give you carte blancheto go be an idiot again or be
(25:55):
fraudulent.
You want to always keep gooddocuments, good funding of
everything with proper titlingand tax returns match.
You're doing all those things.
Then you go.
You know what I don't like theworld seeing everything I got.
And if someone wants to comeafter me, I want to make it a
little harder for them to findme.
And privacy can add really apretty cool layer of protection
(26:17):
in the sense that it's even hardfor someone to find you.
But once they do that privacyis really out the door.
So you have to know it has itslimitations.
Well, here on our list we have10 states that have some form of
filing, an LLC where you don'thave to disclose the manager or
the member and it can be amoving target.
States you know, have their ownlittle filing process and some
(26:39):
are online, some are over thethrough the mail and la la la,
and our paralegals will say, oh,guess what, by the way, this
state does want this now andwhatever, but we've got some
good experience here on which 10states we could hide you as a
manager or a member and give yousome protection from a public
search.
Speaker 3 (26:59):
Yeah, yeah, and I think everybody's kind of got a
little different viewpoint onprivacy.
How important is it to them?
Because it's going to cost you.
There's additional fees addingin another entity here.
This could be this Wyomingentity that gives you some of
that layer three charging orderprotection too and additionally
it can give you some privacy.
We'll get into how that worksin the setup and how you can
(27:20):
structure that, but that's goingto cost you more.
So level one that we talk about,a lot of clients kind of end
there and that's a greatstarting point.
Maybe they have a business or aside hustle and they got a
rental property or two and we'rethere.
They got their trust.
They have a business or a sidehustle and they got a rental
property or two and we're there.
They got their trust.
They got the rental property onthe LLC.
A lot of clients are at leveltwo and they're like I have
multiple properties and theystay there.
(27:41):
Then the next client's at levelthree.
They're like I got a lot ofassets I've accumulated, I got a
million dollars or more of networth.
I'm worried about personalliability possibly and exposing
all my assets in my business ormy LLCs.
So now they get that chargingprotection.
Now we're at layer four andwe're like I need some privacy,
Like an example, just when I hada Grammy award-winning artist,
very famous you would know whoit is but I had to sign a
(28:02):
nondisclosure.
I can't say who it is.
Speaker 2 (28:04):
And you're a lawyer, so I'm like, so don't say their
name no-transcript.
Speaker 3 (28:22):
He's like that's the last thing I need and so, um,
and I think many of you feelthat way.
You know you might not have ahigh public profile, but you're
like I just don't want my nameout there.
I might have a lot of rentals,I might have a big business.
I just don't need it out therefloating everywhere and just for
publicity sake, floating aroundon the internet for someone to
(28:43):
chase down.
What assets do you have?
Plaintiff's lawyers being ableto see everything that you have
and all your entities?
Speaker 2 (28:48):
Yeah, and your brand, your social media presence.
All of a sudden someone sees alittle something.
They just want to make a bigdeal about it, and it's not a
big deal, but your name wasthere.
So, with privacy, we reallywant to again assess what you
want to keep private.
If you in my book, the Tax andLegal Playbook here and there's
(29:10):
a whole section on privacy wherewe also try to go through some
stages of how much privacy doyou really want or need for a
certain asset, you may say Idon't want anybody to know I own
this ranch or this farm.
Or I don't want anybody to knowI own a rental property in an
apartment building that mighthave some tough tenants that
need evicting.
But others are like but that'sit, I don't need people, I don't
(29:31):
care if someone knows where myhome is, or I don't care if they
know that I'm the president ofthis company or where my
personal address is.
Other people are like I got tobe off the grid.
Okay, that's going to beanother stage, and so we want to
kind of assess how much privacyyou need and want and start
giving you some price tags aswell as pain in the butt.
Speaker 3 (29:50):
Tag, yeah, and this is where I see some of the
structuring too, where we'llkind of take different opinions
on other people that are settingthis stuff up.
I'll see a lot of people usingthis holding company for their
operational entity and thenthey're using this Wyoming LLC
and they're using a Wyoming LLCfor their assets, and usually on
(30:10):
the asset side, if they gotenough, I'm like I get that
Charging order protection.
Maybe they're using it forprivacy too.
So the kids they'll use thatWyoming LLC as the member and
the manager, so it kind ofdiscloses any ownership on these
other LLCs in other States.
We can talk about that here ina second.
But there's there's great waysto get more privacy and it makes
sense on that side.
But on the operation side I'mlike, oh, you wanted privacy for
(30:33):
that operational business thatyour name's on the website as
the president and you go out andpromote yourself as the owner
of that business.
I'm like, what are we doingover?
Speaker 2 (30:42):
here yeah.
Speaker 3 (30:43):
And also that entity.
It's not designed to holdassets.
We have that entity tobasically receive income.
Push your income and revenueover to building assets on the
other side.
So I'm like I don't know thatit makes too much sense over
there.
I guess you could have value inthe business.
You may want to sell it one dayI could see some reasons for it
.
But we really like it more onthe asset side this Wyoming LLC
(31:04):
charging order protection toprotect someone from getting up
to your business assets, fromyour personal liability, and
then also creating more privacyon where your assets are.
Speaker 2 (31:20):
So that's a little more private and not out for
everyone to find on the internet.
I like it.
And another way I'd say it isif someone is trying to
recommend a Wyoming entity foreverything you know.
Like you need another entity forthis, you need another entity
for that or that it's going tosave you taxes, which it won't,
because it's where you're doingoperations and where the assets
live of, where you're going tobe taxed, not where the entity
is set up that holds it.
That could give great assetprotection, it could give great
privacy, but the IRS is like Ijust want to know where you're
(31:41):
doing business and our taxreturns are private At least
they should be.
We've heard lately that Dogehas uncovered a little bit of
some releases of tax returninformation, but the average
person does not have access toyour tax returns and we want to
be honest with the IRS.
This is another cautionarypoint.
We're not setting up theseentities to hide income or hide
(32:03):
from the IRS.
We're doing this to have a moreprivate life where we can be
protecting our brand, ourreputation, and not using it as
a license either to be a badperson.
Speaker 3 (32:13):
Yeah, but to take advantage of the laws that are
out there in your favor too,because there are laws, LLCs
right.
And corporation structures thatare, like created to limit your
liability.
That's what limited liabilitycompany stands for, so we can
use these tools and structure itright to benefit us.
There's nothing wrong with that, and we want you to do that, of
course.
Speaker 2 (32:41):
Like we want you to try to protect these assets
you're working so hard to build.
Let me give um, now I'm.
We could sit here for threehours literally and just give
some examples of some specificstrategies that would work.
And it's going to always dependon the types of assets, where
they're at, the equity involvedand what you're trying to
accomplish.
Blah, blah, blah.
And that's the reason whyyou're going to do a tailored,
comprehensive consult that'saffordable, to kind of start
that process and that journey.
But one example I'll just givekind of a fun one, matt and I
(33:03):
like this is, let's say, arizona.
It's actually one of the stateswhere there is terrible privacy
.
Arizona is a bad state forprivacy, although it might be
better for asset protection.
And see, that's something alawyer that's in the weeds every
day is going to help youidentify.
So in Arizona, when you file anLLC, you not only do you have
to list the manager, you alsohave to list any member that
(33:26):
owns 20% or more.
Even if it's your trust,another company or whatever.
You've got to disclose that.
And if there's a change inownership of anyone that owns
20% or more, you have to file anamendment.
So it's at the state.
Well, that's kind of a pain inthe butt, but I want privacy.
So what we might do is set upthat Wyoming entity that does
(33:47):
offer cope protection, as doesArizona, but that single
memberection yeah, pretty cool.
And so that entity can now bethe manager of your Arizona LLC
and also the owner of yourArizona LLC.
So when someone does a publicsearch and says who owns that
apartment building on ScottsdaleRoad and Thomas, oh well, xyz
(34:10):
LLC.
Okay, let's go look at it.
Oh, and a Wyoming LLC is themanager and the owner, let's go
to the Wyoming website and we goover to there, the Wyoming
website, and they're like I wantto know who owns this thing,
damon, oh, it's a law firm thatset it up, that's all I know.
Dang it.
So now it requires a subpoenaand a judge to tell us.
(34:32):
We have to disclose that.
Speaker 3 (34:34):
Which would be very.
You'd have to have donesomething very nasty for us to
be able to have to disclose that, because at least with us it's
attorney-client privilege.
With some non-lawyer that setit up, there's no argument that
they don't have to disclose that.
Okay, so that's anotherdifference of working with an
actual, real lawyer.
So we're not just TV lawyers,we're real lawyers.
You know, it's not just twogood looking guys that could
(34:55):
have been on suits, right, youknow.
Speaker 2 (34:57):
I'd stayed at a holiday in last night, which
gives me even more superpower.
Speaker 3 (35:00):
So, yeah, yeah, that's a throwback joke that's
like a 15 year old one.
Speaker 1 (35:04):
They don't do that anymore.
Speaker 3 (35:05):
They don't know.
I stayed at a holiday in lastnight.
Speaker 2 (35:17):
I don't.
Speaker 3 (35:17):
I like that, old enough to know that joke.
Oh my gosh, I am so old.
Okay, well, there was acommercial that said Our demo,
actually, you know, probably getit, got it.
Speaker 2 (35:21):
I'll say that, yeah, the commercial was if you stayed
at a Holiday Inn Express,you're going to work faster,
move faster the next day and beincredible, and so I think it
was a great commercial.
Speaker 3 (35:28):
I thought it was too.
I was just saying it's a little, you know, it's dated, it's
dated.
Speaker 2 (35:33):
Well, hopefully, my example, guys.
It gives you a little, you know, wets your whistle a little of
okay, this is what we're tryingto do and the lawyer is going to
help identify the strategy.
Tell me the cost how much is itgoing to be to implement and
maintain and then you can makean educated decision.
Bottom line there should be nofear.
There should be no fear.
There should be no pressure.
(35:54):
There should be a visualrepresentation of what you're
doing that makes senseintellectually and emotionally
and your accountant is going tobe able to carry out the order
of doing your tax work withoutconflicting what the lawyer says
.
And they're on the same team.
And that's why we've built anetwork of tax advisors and
train over a thousand taxadvisors in a network that are
(36:16):
trained by us and you pay themseparately.
We don't make any money on that, and they're going to work with
the lawyer to help implementwhat you need.
And so I don't know.
I just wanted to give thatexample of what it might look
like.
Speaker 3 (36:26):
Yeah.
So we want you to haveconfidence going through this.
Whenever you set up, we wantyou to feel confident about it
so you don't have to worry aboutthat.
Go worry about making moremoney.
That's what you're good at,okay.
Don't try to do this yourselfor set it up online or work with
people that don't know whatthey're doing.
Like, get it done right, get itset.
Work with the team that you canadd and build on it as you need
(36:47):
.
Make changes too.
Sometimes you got a life change.
You might have a significantamount of assets come in, or a
different income year or troubleon the horizon.
That's what we're here for,okay.
We want to be here to help youthrough all those challenges and
the opportunities that areheavy.
Speaker 2 (37:02):
I will say this, and I know you didn't mean this, but
with the words you used, Idon't want someone to think set
it, forget it.
We don't want that.
Speaker 3 (37:09):
Yeah Well.
I'm saying it's like haveconfidence in what you said so
you don't have to worry about.
Did I these idiots that I hiredthat aren't lawyers do what?
Did they actually know whatthey were doing?
Speaker 2 (37:17):
Yeah, and but I?
What I mean by that, too, is Iwant you to understand it.
You, you are.
You may be using us as aquarterback, but you're the
owner of the team and what I'dlove for you to do is have that
visual representation and takeit into your family board
meeting and you explain it tothe family.
And if you can't explain whysomething owns something or why
it's there, you need to get backto that consultation and go.
(37:39):
Why did I do this again?
Because you want to at leastunderstand the why, and we're
going to do the work in theweeds and I think it's going to
give you so much confidence andreally be the leader of your
family board meetings and teachyour family about this.
Speaker 3 (37:53):
Yeah, we're part of your team, all right, but you're
leading the team.
You let us know where we canhelp.
We're going to provide ouradvice and expertise and want to
add value to you, of course andwhether that's us or someone
else too this is not meant to be.
We want to give you guidelinesand information.
We got a busy team.
We want to help you.
We love it, but get that good,solid advice.
This is a critical component ofhow you build and grow wealth
(38:13):
is making sure you protect it.
This is defense.
Speaker 2 (38:16):
Yeah, and we talked a lot about asset protection.
I do want to say a couple morewords about privacy.
If this is something that'sreally interesting to you, first
of all, in my tax and legalplaybook pick it up on Amazon
audiobook as well there's awhole section that takes you
through these more extremelayers of privacy setting up
ghost addresses, mail forwarding, which is a service we provide
(38:36):
we would if you want to go offthe grid and not share your
personal address.
How do you get there?
And so check out that sectionon privacy.
Also, I love JJ Luna, probablyone of the industry leaders in
personal privacy protection.
He's an older guy now.
I've interviewed him, man, overthe last 15 years on occasion
on our Main Street podcast andhis books are excellent.
(38:57):
So I'd check out JJ Luna, andonce you get into that genre,
you're going to see some otherauthors that have different ways
of looking at the privacy.
But I just encourage you toalways think of the cost-benefit
analysis.
What does this really mean?
Because if you can't share yourpersonal address, what are you
doing when you go open a newaccount somewhere or register at
(39:18):
a hotel and travel, and it getspretty unique.
You know, you think of JackReacher or Jason Bourne, and
those shows are fun, you knowwhere.
No one knows where they're ator who they are.
But it comes with a cost.
Speaker 3 (39:33):
Yeah, yeah, it takes that If you've got a family and
a real home.
Life and people in school andstuff is a little different to
try to do those gymnastics.
But privacy could be veryreasonable in many aspects of
your assets.
Speaker 2 (39:46):
Yeah, for your assets , and that doesn't have to be
everybody's business Veryachievable.
Speaker 3 (39:51):
We can do with some LLC structuring, understanding
the right states, implementingsomething specific for your
situation.
I love that note you had on theaddresses too, of course, like
we've got a service in oursister company, Main Street
Business Services, where weprovide a virtual address and
privacy address type service tomake sure that your address
stays off of any documents.
Yeah.
Speaker 2 (40:11):
All right.
Well, hopefully this has beeninformative and help you feel
more equipped to make somecareful decisions, because this
can get expensive and wheneverit sounds too good to be true,
get this second opinion.
You're going to be spending alot of money and time over the
next years to maintain andimplement this.
Making sure you get a coupleopinions on the outset will
(40:33):
really help you in the long runby far.
So thanks for listening.
So grateful to be a part ofyour lives, and if you've
enjoyed this podcast, pleaseshare it and give us a two
thumbs up.
Five stars, 10 out of 10, highfives, whatever it takes.
We appreciate you being aregular listener and we'll see
you next week.
I think open forum is going tobe next week.
Speaker 3 (40:54):
Yeah, we need to do some open forum.
So if you've got questions, getover to MainStreetBusinesscom,
submit your questions there.
Mark and I will be goingthrough them and we'll give you
answers.
So be there, we'll see you nexttime.
Thanks everyone.
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