The letter you’ll never want to write.I. M. Brooke
Dear Creditor:
Please accept my apology for being delinquent on your bill.
In reply to your request to send money, I wish to inform you about the difficulties I’ve had in making ends meet. I have been trying to get a handle on my shattered financial condition, and I’ve come up with a few possibilities. It seems that the problem is largely due to various laws, taxes, and insurance policies that “I must pay, first.” My research has identified numerous federal laws, state laws, county laws, city laws, corporation laws and swarms of other laws, too numerous to mention. I’m also narrowing down a myriad of taxes, but it’s seemingly hopeless.
Through these laws, I am “compelled” to pay state sales taxes, state income taxes, federal income taxes, property taxes, business and operating taxes, numerous other business taxes, gasoline tax, phone tax (including, telephone internet national access contribution tax, and I’m not even on it), sewer tax, cigarette tax, meal tax, amusement tax, computer tax, and various other excise taxes. I am required to have a business license, driver’s license, license for my car, motorcycle license, and a license for my dog. Last weekend a friend of mine was married and had to get a marriage license.
For “my own safety” I am told to carry health insurance, life insurance, dental insurance, disability insurance, long term care insurance, property insurance, liability insurance, collision insurance, theft insurance, burglary insurance, accident insurance, business insurance, flood insurance, unemployment insurance and old age pension insurance.
My very small business is governed so much by others, that I sometimes wonder who owns it. I am inspected, expected, suspected, disrespected, rejected, examined, re-examined, informed, required, commanded and compelled to provide a seemingly inexhaustible supply of information to just about every Tom, Dick, and Harry who says he’s from the alphabet soup government agency. I’m spending up to 40% of my time filling out forms and other mandatory reporting or they say, I’m going to be penalized, imprisoned, or both.
I can tell you honestly that but for a miracle that happened, I could not have enclosed this check. A very dear relative of ours, died a few years ago, and the estate was finally settled. After the attorneys, accountants, and appraisers finished settling the probate jail process, paid court costs, federal and state inheritance taxes, I was left with just enough money to pay your bill. Do you think it’s possible that I will be required to pay taxes on this money too? If this is so, would you please be so kind to send it back.
Sincerely yours,
I. M. Broke
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- To reduce, defer or possibly eliminate your income taxes and on your “other income streams” [Federal 39.6% + your state].
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Helpful resources: Many readers also review Asset Protection for Business Owners, LLC vs Trust for Asset Protection, and official SBA guidance while sorting through timing, control, and long-term protection choices.
What often changes the answer
After reviewing Letter to creditor: I am Broke., many people want a clearer sense of how the answer changes once real life timing, funding, and control are added to the discussion.
What usually shapes the next step
- Timing matters because asset protection works best before a claim becomes immediate.
- Control matters because keeping too much direct control can weaken the protection people hoped to create.
- Funding matters because creditors usually look at what was transferred, when it moved, and how the structure operates.
Where readers often continue
A practical next reading path is Asset Protection From Lawsuit, Asset Protection Trust, and Irrevocable Trust. When the question turns from reading to implementation, many readers move from these guides to a direct planning conversation.
