What is judgment proofing? According to nolo.com:
“When a creditor sues you and gets a money judgment against you, it has a variety of methods it can use to collect on that money judgment…
However, if you don’t have any income or property that the creditor can legally go after, then you are what is often referred to as judgment proof. The term is a bit of a misnomer, because the creditor can sue you and get a judgment — it just cannot collect on the judgment.”
Individuals do this through not owning anything in their name, avoiding having bank accounts, dealing in only cash, and not working for a paycheck that could be garnished. This is usually a temporary situation because circumstances can change quickly and unexpectedly. There are also, of course, challenges that arise with living without a traditional income.
What if you are a business? How can you protect yourself and your assets?
We can help you setup your business as a Texas Joint Stock Company, which offers many protections and securities that an LLC or corporation does not. In a nutshell, a Texas Joint Stock Company is set up through private contract, which is exempt from the Fraudulent Transfer Act as the Fraudulent Transfer Act is a state law while private contracts are protected under the constitution. This guarantees that no matter where you may be sued, your assets are protected by private contract under the Constitution and may not be collected as a result of any judgement. While no one plans on being sued, you can never be too careful when it comes to the assets you have worked so hard to obtain. This is a legal and virtually risk-free way to guarantee you will be protected. Also, unlike individual who are judgement proof, this is a long-term solution without the risks and challenges present in individual judgement proofing.
See our website for more information about judgement proofing and many other benefits offered by Texas Joint-Stock Company.
Feel free to contact us for more information about the other services we offer.