Asset Protection for Doctors & High Risk Professionals

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HINDOYAN & ASSOCIATES

AssetProtectionPros.com

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Asset ProtectionShield your assets from predators, creditors, in-laws & outlaws

Fight Back!

Battle-Tested Strategies

Why you’re a targetWhat makes you vulnerable

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Why insurance will fail youExcuses to deny your claim

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Anatomy of a lawsuitDissecting how they will attack you

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How to fight backSophisticated strategies to hit them back

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Calibration with your family’s goalsThe ultimate reason why you practice

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Neutralize Threatswhile Reducing Taxes

For Doctors& High Risk ProfessionalsPlanning

Asset Protection SpecialistsHINDOYAN & ASSOCIATESAttorneys at Law

Practicing with partnersAvoid conflict with business partners

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“My education took longer than most.”

“Because of school & residency, I had to start earning money later than most.”

“My business & personal assets are bigger targets for predators & lawsuits.”

“I took on more debt than most.”

“Therefore, I have less time than most in which to accumulate assets.”

“I have more reasons to protect my business and my assets than most.”

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The Goal of Asset Protection Planning

What Asset Protection IS NOT

Make Yourself Lawsuit-Proof Avoid Strategic MistakesMake yourself a less attractive target for lawsuits. The best way to protect your assets is to erase the incentive for predators to sue. Merely having an Asset Protection Plan makes you less attractive for potential plaintiffs because they know their efforts to take your assets will be wasted.

Legally block access to your medical equipment and personal assets. There is no reason to allow predators and creditors access to the assets you need to continue running your practice. There is especially no need to grant them access to your personal assets.

Many entrepreneurs are unaware of their routine mistakes in how they interact with patients, employees, contractors & vendors. With an Asset Protection Plan, you will have strategies and procedures that will protect you from liability and pitfalls that cost you your assets and peace of mind.

Asset Protection is not about concealing assets or defrauding creditors. An Asset Protection Plan in no way breaks the law. In fact, you are using the law to its fullest to fight off predatory lawyers who abuse the law.

Juries don’t like that you have high income. Studies have shown that juries subconsciously redistribute wealth because they think it’s the right thing to do, despite the fact that the only thing you did wrong was to become a successful doctor.

They think that a lawsuit will not put a dent in your wealth, so predatory lawyers are encouraged to go after those with deep pockets.

Law school teaches that a sure way to get a big settlement from a lawsuit is to sue everybody involved in treating a patient and let the doctors, nurses, anesthesiologists and hospitals fight it out amongst themselves, while plaintiffs sit back and wait to cash your check.

Robin Hood Syndrome

“Divide & Conquer” Lawsuits

Why You’re A Target

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Most lawyers work on a contingency basis. Therefore, the plaintiff does not really have much out-of-pocket expense when they file a lawsuit.

When you settle, their lawyer takes a cut and the balance goes into the plaintiff’s pocket. This also makes the predator-lawyer an investor in the case.

Therefore, the lawyer will stop at nothing to get the highest rate of return on their investment; namely, destroying your prac-tice and taking your assets.

93% of Doctors Settle Lawsuits

Lawyers Know You Will Settle

Plaintiffs Have Nothing To Lose

Reputational Damage

Fear of Losses

Legal Defense Cost

Anxiety of Litigation

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Your Insurance Carrier Will Abandon YouYour insurance company will create any excuse to deny your claim. They will argue that the particular facts of the case are not covered under your policy.

They will try to dissect the claim so that they can shift as much of the burden of payment onto you.

Therefore, they will become your enemy, too. They will argue that you should pay from your personal assets

rather than covering the cost of the judgment and your defense, as they promised when they sold you the malpractice insurance coverage.

As it is, malpractice insurance will not protect you against claims that come from non-patient creditors and predators.

Simply put, your only teammate is your Asset Protection Plan.

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Medical Malpractice Isn’t Your Only Worry

Malpractice Insurance Doesn’t Cover“Slip & Fall” lawsuits in your office Negligence of your employees

Claims from lenders Business partner disputes

Divorcing spouses Vendors & suppliers

Contractors Landlords

Loans you personally guaranteed Economic downturns

Any successful entrepreneur knows that his or her very success invites unwanted attention from predators.

This is not limited to patients suing for malpractice. Your success also breeds attacks from competitors, partners, local government agencies and taxing authorities.

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Anatomy of a LawsuitEconomic Analysis of the Target

Filings & Pleadings

Liens on your Assets

Discovery Phase

Discovery is when lawyers will bleed you dry and rack up your expenses.

Discovery is the process in which parties to a lawsuit request documents, depositions and information from each other in order to “discover” evidence for trial. For a defendant, this is often the most expensive, destructive and stressful phase of litigation.

Plaintiffs intentionally make it painful for you and your bank account by requesting irrelevant documents that take time and money to produce. They

The Discovery Phase Nightmare

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Anatomy of a LawsuitTrial

Verdict

Judgment

Liquidation of Assets

will also put you through the indignity of a deposition designed to attack you, destroy your credibility and embarrass you to the point that you will give up and cut them a check to go away.

This is typically the time when most defendants surrender and settle the case. The destructive nature of discovery is stressful enough as it is, but they will also try to use what they find to later publicly discredit you and your abilities as a doctor.

Without a proper Asset Protection Plan, which prevents them from even asking about your protected assets, you are left exposed and are required to comply with their demands and embarrassing questioning.

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Asset Protection

StrategiesPosition yourself at a strategic

advantage to change the behavior of your opponents.

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Asset Protection

Strategies

Why leave all of your assets exposed? Segregate your medical practice, operating equipment, real estate & intellectual property

into special purpose companies and trusts.

PROPERTY SEGREGATION

“With your assets stuck inside one S-Corporation, they will fall like dominos.”

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PROPERTY SEGREGATION

DIAGNOSTIC & THERAPEUTIC EQUIPMENTThe most valuable assets in your practice are probably the equipment you use to treat your patients. These are also the assets that you cannot practice without.

That is why predators target these assets when they size you up for a lawsuit. You will also find it difficult to finance the purchase of new equip-ment after losing a lawsuit.

Instead, your separate “equipment company” will be able to lease the equipment to your practice.Even if a lawsuit targets your practice, they will not have access to these assets.

Thus, you can simply continute to provide treat-ment with your tools intact.

No delays. No loss of income. No loss of assets. Just get back to work.

TRADEMARKS &

INTELLECTUAL PROPERTYMany doctors get their business from word of mouth and their reputation. On a balance sheet, this is quantified as your “Goodwill” and intellectual property.

Lawyers know how to leverage your reputation in a lawsuit.

Your separate “intellectual property company” will keep these intangible assets free from damage and keep your credibility intact.

REAL ESTATE Real estate is a valuable asset that is appealing in a lawsuit.

Keep it in a separate company.

Slip & fall lawsuits are not cov-ered by med mal insurance.

There is no reason to leave your real estate accessible to people who sue your medical practice or you personally.12



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Business

Family Goals

Legacy

Protection

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I want to control my property when I am alive and well.

I want to provide for myself and my family if I become disabled.

I want to give what I have to whom I want, when I want, in the way I want.

I want to minimize the effects of taxes, legal fees and administrative costs.

Piecing the Puzzle Together

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Reconcile business goals with overall family goals.

The Family LLC

Family LLCs are used to protect family assets from creditors and predators, to divide income amongst generations (i.e., grandparents, parents and grandchildren), to maximize a family’s disposable income, and to employ long-term estate planning strategies.

Typically, a senior family member creates the Family LLC and becomes the “Managing Member.” Children and grandchildren can also be Members, but will not have any control or rights to manage property.

Benefits of Family LLCs include shifting of income tax to the lower tax brackets of the younger generations. Estate planning benefits include reducing the size of the taxable estate, and creating a long-term family plan, while protecting assets from creditors and lawsuits targeting the family’s assets.

Personal assets, real estate, money and securities that are put into the Family LLC are protected from reach. Children and grandchildren can be given shares of the LLC, and major discounts in valuation of those assets are applied because each child and grandchild receives only a minority interest, without the right to manage. Liabilities are limited to the amount each person contributes to the LLC.

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Each stage of life, secured.

Family LLCs also safeguard your assets when the shares are gifted to your children, since their inability to control the assets will provide some protection from your children’s creditors, such as a divorcing spouse. Such creditors are blocked from gaining assets from the Family LLC when satisfying a judgment.

Creditors would only be able to reach the Family LLC’s voluntary distributions.

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Practicing with Partners

Physicians typically go into practice with partners, often when a junior physician buys into a practice with

existing senior physicians.

3 Essestials for Practicing with Partners:

Harmony among business partners is often difficult to maintain. Disputes arise when there is no clear game plan for how to address the liability brought on by an individual, what to do when an owner dies, becomes incapacitated, goes through a divorce in which their share of the business is at stake, or when there are no liquid funds to finance the buy-out of a departing partner.

“Don’t ignore the elephant in the room.”

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Practicing with Partners

2. A Practice Buy-In Agreement for each owner

3. An Employment Agreement for each doctor

1. A Buy-Sell Agreement among owners

3 Essestials for Practicing with Partners:

A Practice Buy-In Agreement does more than just set the basic terms for the purchase of a share in the practice. If you want to make sure that your a potential partner will actually bring revenue into the partnership, this agreement can mandate that they meet financial targets during a trial period.If they are not able to match your expectations, the contract will expire and they will have no right to buy in. If they prove to be a revenue generator, then they automatically vest into the ownership according to the terms of the agreement.

An Employment Agreement determines the conditions for continued employment, according to the values of your practice.

At some point, every owner must leave the business, whether it is through death or wanting to retire and sell their interest in the business. Have a game plan for an owner’s death, disability, retirement, divorce, illegal act or any other event that could cause chaos in your business. A Buy-Sell Agreement not only memorializes the plan, but also creates funds to pay for a buy-out.

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AssetProtectionPros.comor call: (310) 601-8850

9595 Wilshire Blvd., Ste. 900

Beverly Hills, CA 90212

Hindoyan & AssociatesAttorneys at Law

ASSET PROTECTION | BUSINESS STRUCTURING | ESTATE PLANNING

Pursuant to requirements imposed by the Internal Revenue Service, any tax advice contained in this communication (including any attachments) is not intended to be used, and cannot be used, for

purposes of avoiding penalties imposed under the United States Internal Revenue Code or promoting, marketing or recommending to another person any tax-related matter. Please contact us if you wish to

have formal written advice on this matter.

Documents

Asset Protection for Doctors & High Risk Professionals