hi lee phillips here i want to talk to you for a minute uh i always get the question does an llc a
single member llc have asset protection and the the the answer is well that's a dumb question i
don't understand because an llc has two aspects to the asset protection one is the corporate shield
the corporate shield protects me from what happens out in the company
and that corporate shield is always there whether it's a single member llc whether
it's a multiple member llc whether it's taxed as a disregarded entity whether
it's taxed as a c corporation or under chapter c of the irs code it's always there
so in that sense the question does a single member llc have asset protection makes no sense
and that's what people usually think of when they say asset protection so yes a single member llc
has asset protection the question is does a single member llc have charging order
protection that's a different type of protection what charging order does and we have other
videos on charging order protection and you need to understand it in detail because it's important
the charging order protection protects the assets of the company and that might be
a single family rental whatever the company owns whatever the llc owns it protects that asset
from what happens to the members the owners now if the an owner a stockholder of
ibm gets sued or goes bankrupt or gets divorced and an ibm stock is lost ibm could care less
but if it's your little company and you own all the stock you're a single member llc right
you own all of the stock then the question is does the charging order protection
protect the assets of the company and the answer is it depends it depends upon which state you live
in a number of states now utah and idaho i think uh maryland uh have actually passed laws which say
that single member llcs don't get charging order protection that is if i get sued my creditors can
immediately come and take the assets of the llc as part of the judgment they get against me
they don't really take the assets of the llc they get the stock of the llc but essentially
or the membership interest of the llc but essentially they get the assets of the llc
uh now in in in those states utah idaho uh that have passed laws you have to have at
least two members at least two owners and the concept is we're protecting the other owner and
you're gonna have to listen to the other youtube videos on charging orders to get that concept
but there are a lot of states uh the ninth circuit which is all the wackos up and down the west coast
uh you guys you don't get charging order protection for single member llcs in
bankruptcy for example but we have a lot of states now we have about a dozen florida colorado
there are a lot of states about a dozen of them like i say that now say if you only have a
single member llc you don't get the charging order protection the assets of the llc are not protected
from the liabilities the bankruptcies the illnesses the problems that the individual owners
of the llc members of the llc get into so it's not the the the liabilities that you have personally
uh the llc assets are not protected if you have a single member llc
obviously the trend is to more more and more states and it's going to take a long time
years but more and more states are going to the concept of single member llcs do not have charging
order protection all llc's will always have the corporate shield which protects the member
from what happens in the company so when you say does a single member llc have asset protection i
go well i don't know what do you mean by asset protection does that mean the corporate shield
or does it mean the charging order protection now i've got a full set out for you it's called the
llc mini course and and we've got five i think it's five courses that you go through they're
delivered electronically and and and you can read through them and and pick up lots of aspects
about llc's now don't forget to subscribe and hit the button and ring the bell
and do whatever else you do out there in youtube land but if you like us please make sure you
subscribe if you're not already subscribed in fact a lot of you may want my written
newsletter i send out a written newsletter every month i write it it isn't a canned thing
if you want that you're going to have to uh well you're going to have to email us at
info legalese.com and tell them you want the llc mini course or the llc mini course and you want to
sign up for the newsletter there is a charge on it i think it's five dollars and 72 cents
for the first three months it's actually physically mailed to you
uh 5.72 cents or whatever it is for the first three months and then after that it's 19
20 a month but i have people who have been on it for 15 years and i keep writing new new newsletter
articles every month so uh it's good to have you and we will see you on our next youtube video