5 Questions To Ask When Choosing Your Biz Legal Structure (Infographic)

Like many things in life, there are deep, probing questions to ask when setting up your business's legal structure. And unless you have REAL experience with doing this, as with anything else, you probably don't know the real questions to ask.

It's easy to find Frequently Asked Questions. It's much harder to find the SHOULD Ask Questions.

So here are 5 SHOULD-ASK questions when it comes to setting up your business's legal structure:

  1. How do the wealthy protect THEIR assets?
  2. Why do the wealthy use complex structures?
  3. What's the REAL reason I'm in business?
  4. What happens to this business when I die?

1- How do the wealthy protect their assets?

They hide them behind complex structures, most of which you never see. They KEEP more, paying less in taxes, starting with a C-Corp. Not only does the C-corp allow you to have unlimited members, but it also allows other businesses to own stock. (to be a member).

This means that it doesn't have to own any assets at all - those can be held by an LLC, for example.

So when that C-corp is sued - the world, especially the States, is so lawsuit happy these days - when that C-Corp is sued, there's nothing there. Simply dissolve it, open a new one, and carry on.

2- Why do the wealthy use multiple entities for their business structure?

See question #1!

3- What's the REAL reason I'm in business?

Not ME, of course -- YOU.

There are a LOT Of reasons people start a business, and here are some people have shared with me:

To end generational brokenness, never work again, and to leave a legacy to my children.

Because I needed to have something to show for my life's work and life is too short to not do what I'm truly passionate about.

Because I want to help people find more options than what they are giving in the doctors office for health conditions or general health and wellness. And there are so many talented practitioners and modalities that people just aren’t aware that are available that can be, quite frankly, life-changing!

hate working for other people (idiots) when I knew more than they did lol, worked harder than they did too. Had to get out before going 'postal'

To help others have an opportunity to heal. To have space away from my family (because we all need time right?) To help with the income for my family.

To help people who had financial issues with the IRS.

Wanted to be able to heal horses faster and teach my daughter how to trim. Successfully did both! And still at it😎

Now, our reasons change as we get older, as our business matures. This is a good thing to journal on, so you're clear on your reasons for being in business.

4- What happens to my business when I die?

When we're young, we're immortal. As we get a little older, and have a few brushes with death, or have family, friends, and acquaintances pass on, we realize how fragile life is.

Of course, that's what makes it valuable - the very fact that it's so fragile. AND of course, that we (usually) don't know in advance when our time is up.

I say this not to frighten you, as you probably already know this, but to underscore a very real fact:

1- We're in business for a REASON, as we just established. Usually, that's for a bigger reason than to just make rent this month. We often have a MISSION we want to accomplish, to change the world in some small way.

2- Probate is a PITA, even for a simple estate. My dad passed in 2003, leaving the remnants of his business for my mother. He WAS the business. Without him, it was just plants in the garden, and a small bank account. There was no probate.

When my mother passed in 2019, there was the house and 9 acres of land, her bank account. Her taxes had to be filed. The property had to be sold. And that all had to be divided up between the seven of us kids.

Probate took over a year.

A business is MUCH more complex, and therefore takes much longer to settle.

And if you have an S-Corp or just an LLC, it is shut DOWN during that time. If you have other structures, it's still up and running. Employees, staff, vendors get paid. Clients, customers, members, etc, all are cared for. There's still a business at the end of the day, because there's no probate.

5- Do I have the funds to set this all up?

I hear ya - you're not a Rockefeller. Accountants and attorneys, who are NOT known for their accumen as savvy marketers, ARE in fact known for charging a LOT to set them up.

They have to charge a lot - they typically don't understand the real value of their clients nor how to fully serve them.

Examples -

1 - In 2007, I set up an LLC. Ran me $1600 to do so. Of course, then I didn't know how to market or make sales - but I had my LLC.

2 - Have a friend who spent over $10,000 setting up his business structure. And it didn't give him the protection he hoped it would.

You can get the help you need to properly set up your structure - and not have it break the bank. Here's a mini workshop I host a couple times a month: