Another big mistakes people make when setting up a new corporation is
simply adding an Inc., Ltd., or Corp after their name when choosing a name for
the new corporation.
Besides the very lucrative tax savings opportunities available in a corporation,
it can increase your privacy and lessen the potential for frivolous lawsuits.
It is no secret that people will sue anyone
for anything if they think they can get some money out of it. Ambulance
chasing attorneys, when deciding whether or not to take on a case don't care one
iota whether or not the case is justified. What they are concerned with is
how deep your pockets are. They will do a search to see what assets you
own. If your name is the same as your corporation's, it will be impossible
to prevent the vultures from identifying everything owned by you personally and
through the corp. If the names are different, there is less likelihood
that a search will link ownership of assets. If there doesn't appear to be
a lot of attachable assets, the normal ambulance chaser will pass on accepting
the case.
The best corporate names are those that give
away no hint of who owns them. There is no requirement that the name of a
corporation identify the owner or even what it does. I'm a big fan of
using as generic and vague a name as possible, such as initials or a made up
name. Several clients have fabricated great corporate names from parts of
their kids' or grandkids' names.
Besides protecting against nuisance lawsuits,
using a vague corporate name allows a level of privacy that would not otherwise
be available. Not everyone wants all of their transactions published in
the paper for the whole world to see.
KMK
This page was most recently modified:
Sunday, January 29, 2012
