My April 20, 2010 blog discusses how the IRS avoids being subject to the charging order remedy when seeking to collect from an LLC in which the debtor taxpayer is a member. Unfortunately, the IRS has still another offensive weapon when chasing members of LLC's for money.
Continue reading "Another Circumvention of the Charging Order Remedy" »
I know that many Michigan asset protection planning attorneys mistakenly take for granted that what I am about to say is common knowledge, but utilizing limited liability companies to hold commercial real estate and residential rental properties is an invaluable tool to protect your assets. I spoke with a prospective new client recently and was surprised to see that this sophisticated businessman who owns more than 100 commercial and residential rental properties throughout Michigan holds all of these properties in his sole name.
Michigan Asset Protection Lawyers constantly extol the protection that Michigan limited liability companies provide debtors as a result of the charging order remedy. As the story line goes, a creditor with a judgment against an LLC member of a multimember LLC cannot reach LLC assets directly. Instead, it obtains a charging order and distributions otherwise payable to the debtor member must now be paid directly to the creditor. Since the debtor often has influence over whether distributions are made, this gives the debtor a negotiating opportunity with his creditors. However, in the real world the charging order may not be as powerful as advertised.
In dealing with the IRS, you frequently see the government attempting to collect debts owed by members of LLC's by levying directly on the assets of the Michigan LLC. How can the government do this you ask. Isn't the government bound by the charging order rules under Michigan law? Indeed the government has acknowledged in published notices that in the case of multimember LLC's it will honor the charging order rules...so what gives?
Continue reading "The Charging Order...Asset Protection Lawyers Overrate Its Power" »
Jun 22, 10 03:51 PM Another Circumvention of the Charging Order Remedy My April 20, 2010 blog discusses how the IRS avoids being subject to the charging...
Apr 28, 10 10:31 AM Limited Liability Companies, a Staple of any Asset Protection Plan Involving Real Property I know that many Michigan asset protection planning attorneys mistakenly take for granted that what...
Apr 20, 10 09:21 AM The Charging Order...Asset Protection Lawyers Overrate Its Power Michigan Asset Protection Lawyers constantly extol the protection that Michigan limited liability companies provide debtors...
