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Bill
Bill, Enrolled Agent
Category: Tax
Satisfied Customers: 3153
Experience:  EA, CEBS - 35 years experience providing financial advice
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If my wife starts a business as a C Corporation or an ...

Customer Question

If my wife starts a business as a C Corporation or an S Corporation, can her business assets be disrupted if I would happen to get sued or go through backruptcy?
Submitted: 8 years ago.
Category: Tax
Expert:  Bill replied 8 years ago.

As long as you have no ownership in the business then the assets in her business are not accessible to your creditors as the result of a lawsuit or bankruptcy. In addition, her personal assets are not accessible to creditors of her business as long as she does not personally guarantee any debt of the business.

http://www.workz.com/content/view_content.html?section_id=531&content_id=6589

http://www.powerhomebiz.com/vol128/incorporate.htm

 

Customer: replied 8 years ago.
Reply to Bill's Post: Does it make a difference that we file tax returns together jointly and also that I will be an employee on her corporation?
Expert:  Bill replied 8 years ago.

Creditors cannot access your wife's assets if she is not a co-signer or obligated for the debt. However, the IRS could place a lien or levy on her assets if taxes are due and you file a joint return.

Customer: replied 8 years ago.

Illinois

Expert:  Bill replied 8 years ago.

Creditors cannot access your wife's assets if she is not a co-signer or obligated for the debt. However, the IRS could place a lien or levy on her assets if you file a joint return and taxes are due.