Asset protection structures are often better visualized than explained. Scroll down to view graphics of:
- The Classic Two-Company Structure
- Joint Venture – Single Asset (e.g., Fix & Flip)
- Joint Venture – Multiple Assets
- Triple Firewall with Anonymity
- Anonymity Structure with Single Hybrid Trust
- Anonymity Structure with Two Trusts
- Hub-Sub Structure
- Basic Limited Partnership Structure
- Single Promoter Syndication
- Multiple Promoter Syndication
- Limited Partnership Syndication
Each of these is just an example with many possible variations. Our goal is to custom-design legal entity structures that maximize asset protection while providing for efficient operation. Simpler is usually better in our view, so we strive for structures that are clean and free of unnecessary entity clutter. Because this firm has significant litigation experience, we are also focused on being able to defend any structure we create if it is challenged in court.
It is suggested that one read our article Asset Protection in Texas, for valuable context in the interpretation and application of the foregoing diagrams. Other useful articles would include Partnerships and Joint Ventures and LLCs in Texas – The Series LLC. One size does not fit all. There is no substitute for careful analysis by an experienced real estate or business lawyer followed by customization of an asset protection structure that specifically suits the needs of the client. Clients should also discuss tax implications with their CPA before implementing any asset protection structure.