Y'know, I'm not sure about some of the comments on the "Incorporation questions" thread. In another life I had an executive consulting firm with six employees and about a $500K annual gross. I had it set up as a Subchapter S, for all the right reasons, but was told by both my lawyer and my CPA that "piercing the corporate shield" in liability cases and other lawsuits was distressingly easy for "the system" to do. The big corporations tend to have big corporate assets for the pit bulls to attack, but the small corporation--especially in a services business--usually has no significant assets and the courts will definitely tap into the owner's personal assets, particularly if the issue arises from the negligence, malfeasance, criminal or just plain boneheaded activity of the stockholders/owners. One real protection, however, is that assets belonging to the corporation (LLC or whatever) ARE protected from liability judgments against the owner(s) that arise from non-business activity. For example, if you are driving the family to church in your 1977 Yugo and destroy a brand new Rolls Royce because you failed to yield at an intersection, your business assets are likely safe. But if you are driving your service vehicle (with the neon advertising all ablaze) at 10 AM on Tuesday, on your way to tune that church's piano, you might be trading your house for their new car. So, if you drop granny's Bosey Imperial down three flights of stairs, your retirement and kids' college funds are probably, as the French say, histoire -- regardless of how your business is structured for tax purposes. The key to sleeping well at night is liability insurance, incorporated or not. Good info here http://www.allbusiness.com/finance/insurance-liability-insurance/2601-1.html I am certainly open to being corrected by someone with real-world experience in this, or a law degree, but I'm pretty sure I have it right. Alan Barnard Salem, MO -------------- next part -------------- An HTML attachment was scrubbed... URL: https://www.moypiano.com/ptg/pianotech.php/attachments/20080320/ddf069f2/attachment.html
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