| Posted by: Dawn Jul 14 2004, 10:42 AM |
I read your wonderful feedback regarding moving a rental property into the S Company.
Your answer touched on the cash flow. but I would like to know about the liability. If I move the debt out of my personal income/credit and move the assests to the company, doesn't that also remove the liability and provide an better tax benefit.
Please let me know about the personal liability.
Thanks. |
| Posted by: The Fox Jul 14 2004, 12:36 PM |
Dawn, do yourself a favor and check out www.nolo.com, and specifically http://www.nolo.com/lawcenter/index.cfm/catID/19B45DBF-E85F-4A3D-950E3E07E32851A7/subcatid/5DE04E60-45BB-4108-8D757E247F35B8AB. When you've done your own research, make sure you talk to a law professional for the expert advice and assistance.
As to the personal liability you asked about, creating a separate company will create a "corporate shield" that will help protect your assets in the event of litigation. Theoretically the creation of the separate entity will take your personal assets "off the hook" in the event of a collection action from a bank. However, the bank will more than likely ask/demand you personally guarantee the loan(s). As mentioned above though, you still retain the protection from litigation.
I'm not a lawyer, but that's my knowledge of the subject - hope it helps.
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