Consult a tax advisor for applicabil- ity of which entity is appropriate for your situation. С Corporations "And you always try to operate via а С Corporate entity, don't you?" I would ask rich dad. "In most cases," he replied. "Remember that it is the plan before the product or in this case the corporate entity. The point is that those who operate from the В quadrant tend to have more choices and hence more control over the best en- tity to best make their plan work. Again, those fine points should be discussed with both your tax attorney and your tax accountant." "But why a C-Corporation?" I asked. "What is the differ- ence that is so important to you?" "This is the one big difference," he said, having waited a long time to explain it. "A sole proprietorship, a partnership, and an S-Corporation are all part of you. They are, in simple terms, an extension of you." 'And what is a C-Corporation?" I asked. "A C-Corporation is another you. It is not just an extension of you. A C-Corporation has the ability to be a clone of you. If you are serious about doing business, then you do not want to do business as a private citizen. That is too risky, especially in this day and age of lawsuits. When you do business, you want a clone of you actually doing the business. You do not want to do business or own anything as a private citizen," rich dad guided me. "If you want to be a rich private citizen, you need to be as poor and penniless as possible on paper." Rich dad also said, "The poor and the middle class, on the other hand, want to own everything in their name. 'Pride of owner- ship,' they call it. I call anything with your name on it 'a target for predators and lawyers.'" 268 Rich Dad's Guide to Investing The main point rich dad was trying to make was "The rich do not want to own anything but want to control everything. And they control via corporations and limited partnerships." That is why control of the E in E-T-C is so important to the rich. Within the last two years, I have seen a devastating exam- ple of how the choice of entity could have helped prevent the financial destruction of a family. A very successful local hardware store was owned as a fam- ily partnership. The family had been in town forever, knew everyone, had become wealthy, and was quite involved in civic and charitable organizations. You could not have asked for a more wonderful, caring, and giving couple. One night, their teenage daughter was drinking and driving, had an acci- dent, and killed a passenger in the other car. Their lives were dramatically altered. Their 17-year-old daughter was sent to an adult prison for seven years and the family lost everything they owned, including the business. In sharing this example, I am not trying to make any moral or parenting statements; I'm simply pointing out that proper financial planning for both the family and the business might-through the use of insurance, trusts, limited partnerships, or corporations-have prevented this family from losing its livelihood.