[blackflame7000]

These people who are afraid of lawsuits need to start learning how to manage money and assets because there are ways to protect yourself. If you have something of value, you should always take steps to protect it. You can put your house in an LLC for example so if you are personally sued they can't take it. Then once you don't have much to lose on paper, lawsuits lose their power. The biggest advantage that a person has versus a company is that they have less to lose because a persons life doesn't end with bankruptcy whereas a companies life does. Furthermore, a person can create LLCs which are like virtual people in many ways related to credit and money.

[dragonwriter]

> You can put your house in an LLC for example so if you are personally sued they can't take it.

If it's a single member LLC, that actually doesn't work in a lot of states (the whole purpose of the way LLC reverse liability protection is to protect the integrity of corporate joint ventures, which are the motivating use case for LLCs), and has either been found by courts are expressly specified by legislatures not to apply to single member LLCs in many states. There are a handful of states where it does apply, though, and others where the rules are unclear.

And even when it does apply, they can't take your house directly, sure, but they can get a charging order against any distribution of funds from the LLC to you that hangs around until you do pay the judgement, so you can't ever extract funds from the LLC. And, sure, you can mitigate the effect of that by just running more of your life through the LLC, but the more you do that, the more you risk the LLC itself being liable, either alone or with you personally, in any legal trouble you get in, in which case the whole purpose is defeated.

Also, LLCs aren't free to set up and maintain, there are fees and additional compliance/tax prep/record-keeping costs. It makes sense if you are wealthy (especially in a particularly SMLLC-friendly jursidiction), but not for most people, even most well-paid workers.

[blackflame7000]

The house owned by the LLC does not have to be in the same state as where the LLC is filed. You can file the LLC in a state that has laws friendly to what you are trying to accomplish. Furthermore, services like LegalZoom make the costs negligible to the asset they are protecting especially since it doesn't make any money.

There are much more conventional albeit expensive alternatives like umbrella insurance but that doesn't change the fact that the fear of a lawsuit doesn't have to be so scary. I mean that's what many companies are banking on because the only people that really win in litigation is the lawyers.

[dragonwriter]

> The house owned by the LLC does not have to be in the same state as where the LLC is filed.

It doesn't, but in many states to own real property, just as to transactions business, you'll have to register your foreign LLC as a foreign LLC, which often involves paying a foreign LLC fee equivalent to the franchise fee you'd have to pay for a local LLC in the same state.

Also, bankruptcy (which a judgement you can't satisfy without the “protected” asset could force you into) will bypass he protection, so basically this doesn't do much protect your assets if you actually need it to (that is, if you can't satisfy the judgement without the “protected” assets.)

[dpflan]

Interesting. Have you done this? I’m curious because this sounds like a good idea, but am curious about what complexity this introduces into day-to-day life.

[doctorpangloss]

While I can’t really tell you why people are downvoting you, it should be clear that this LLC stuff is exactly the kind of moneyed advantage that the legal system ought not to reward that the OP was referring to.

[alexcnwy]

It’s more tax efficient too.

Genuinely not sure why people are downvoting you.

[coldtea]

Because it's just bad advice. They can hit your LLC with a lawsuit as well, they can make it so your LLC way of making money dies because they have you tied in court, and you might not even be considered as discreet entity (and thus protected) from the LLC (depending on jurisdiction). Not to mention the associated costs and extra effort (and all that for what? Preparation for any future personal lawsuit?)

[Rexxar]

> Genuinely not sure why people are downvoting you

Because he is condescending and because having to create an LLC to protect your house from legal harassment is the sign that the US legal system is completely broken, not the sign that people don't know how to manage them-selves.

[blackflame7000]

I was being condescending towards the people who let a fake blood testing company send out fake results putting lives at risk just because they were afraid to get hit with lawsuits that would ultimately be frivolous anyway because they know its all fake!