Liquid assets can be owned by a Nevada Limited Partnership and managed privately by an anonymous manager. This article provides examples of structuring a company for the purposes of privacy and asset protection. Readers are advised to consult their expert asset protection attorney as no information contained herein should be interpreted as legal advice. 

SINGLE PERSON NEVADA LIMITED PARTNERSHIP

Single individuals who desire anonymity and asset protection may form a Nevada Family Limited Partnership-also known as a Nevada Limited Partnership.

The advantages of using Nevada as a jurisdiction for company formation are numerous and asset protection attorneys and privacy authors, (Hall, 2006) have documented the benefits of Nevada corporations, Limited Liability Companies and Partnerships.

A Nevada Limited Liability Company may be formed for the sole purpose of becoming a General Partner of the Nevada Limited Partnership. The general partner will own one percent of the company assets, have full decision making power of the company, and will have personal liability exposure. General partners have no liability protection. Limited partners have no liability exposure.

The limited partnership will hold ninety-nine percent of the assets and while it is controlled by the single individual forming the entity, this majority portion of the company is protected from personal debts and obligations incurred by the limited partner-the single person forming the company.

Under this structure, the single individual has transferred all liquid assets to the limited partnership that was formed for the purpose of holding investments.

One percent of the assets transferred to the Nevada Limited Partnership-the stake held by the general partner is at risk.

The goal of owning nothing and controlling everything has been met through the use of a limited partnership as an investment company.

TRADITIONAL FAMILY LIMITED PARTNERSHIP

Family limited partnerships are commonly used for asset protection and parents are often minority owners of assets-one or two percent while maintaining full control of the company. Children become limited partners and while their partnership interest may own ninety-eight or ninety-nine percent of the assets of the partnership, they have no control over the assets as the parents and general partners control everything and have only one to two percent at risk through the liability of their general partnership interest in the family limited partnership.

PRIVACY IS GUARANTEED-WHEN YOU DO IT RIGHT

Registration of companies is a requirement for legitimacy and managers are named on filing registration forms with the Nevada Secretary of State.

Through the use of the Trust Manager Principle, (Hall, 2006) controller’s of the single- person limited partnership or traditional style, family limited partnership may achieve anonymity

ANONYMOUS HOLDINGS

The use of a partnership for holding only liquid investments is the subject of this discussion and is per the advice of certain attorneys who have counseled this author.

Stock brokerage accounts held by a limited partnership and managed by the controller(s) of the company-the single person or parents forming the limited partnership can achieve a high degree of privacy.

Title the account in the company name only. Company names should not reflect true controllers’ identification. For example, Bertha and John Wooloverfield may call the partnership under their control, the Northern High Mountain Limited Partnership and not include their names as partners on the stock brokerage account title. Their names as signers will be known only to the brokerage account personnel who service the account.

Concerning tax identifiers, an EIN will necessarily be obtained for the partnership when a U.S. stock brokerage firm is used for holding company assets.

Through careful consideration to details of registering the company, account titles and operations as described in Privacy Crisis: Identity Theft Prevention Plan and Guide to Anonymous Living (www.PrivacyCrisis.com), the partnership can be a private entity with asset protection.

ASSET PROTECTION

While both privacy and asset protection are the goals of the Nevada Limited Partnership, the person or people who manage the company have structured the business to empower them to gain full control without personal liability.

In the event, a manager, partner has to disclose information concerning partnership interest, the damage to the individual is minimal. Managers manage the business and the partnership under their control is a separate entity.

A Nevada limited partnership, a separate entity under the control of "Billy Thortonbecker" cannot be pierced to satisfy the judgment against Mr. Thortonbecker for damages he caused during an automobile accident, for example. I say "cannot" be pierced and must clarify that as per my research, a Nevada Limited Partnership has never been pierced to satisfy a personal judgment against a limited partner in a supreme court case.

Certain asset protection attorneys have utilized another layer of protection for the Nevada limited partnership. Offshore Asset Protection Trusts have been formed in favorable jurisdictions and used to own the partnership for the purpose of making assets held by the partnership more difficult to seize. 

References:

Hall, Grant, Privacy Crisis: Identity Theft Prevention Plan and Guide to Anonymous Living, James Clark King, LLC, 2006, www.PrivacyCrisis.com

Copyright, James Clark King, LLC, December 20, 2008