When I first opened a business I did some research into whatever protection an LLC would provide. The goal would be to protect your estate from
a law suit and limit it to the business assets. I came to the conclusion that due to our professional status we would not be sheltered from such a suit - especially if it arose out of the "standard of care" that we are held to.
Does anyone come up with a different angle on this? I have seen so many surveyors in our area that have gone the LLC route that I am wondering if I am wrong about this and would appreciate any input you might have.
Side note: I have never been sued, I have never even been to court but my brother is a l**yer (growing up I noticed he like to argue a lot) and I hope to stay court-free!
The primary benefit of being an LLC comes about if you are the client who doesn't want to pay his survey invoice. Next to impossible to ever get a penny out of the LLC. So, if your goal is to stiff someone else, go for it. I have a bunch of papers that say I can go to an office two States away and start hauling away their computers and office furniture up to a value equal to the current amount owed. It helps to have the local police escort you on that trip, or so I have been told. Getting cash in any other way is highly unlikely.
Coady, post: 355232, member: 6546 wrote: Does anyone come up with a different angle on this?
Maybe an LLC would protect you, maybe it wouldn't. Professional liability isn't the only kind of liability there is in a business. Suppose your work truck gets in an accident? Suppose you get behind on the office rent or instrument payments?
LLC's aren't a big deal to set up. So why not take all the precautions you can?
I have a single member LLC. As it was explained by my attorney & and my accountant, it is mostly for tax purposes (no separate corporate tax).
I suppose it may offer some protection from ordinary liability suits, there is no protection at all from professional liability if you are licensed.
I was sued about 10 years ago because of my presence as a PE at a construction accident. They sued, among other parties, my LLC and also me individually.
Gromaticus, post: 355260, member: 597 wrote: I have a single member LLC. As it was explained by my attorney & and my accountant, it is mostly for tax purposes (no separate corporate tax).
That is generally correct. The major benefits of structuring an LLC has to do with taxes and the way dividends are distributed. Business liability and professional liability are two different horses.
setup the LLC and also make sure you have INSURANCE. That should also help protect you.
I didn't see any benefit to incorporation or LLC, so I set up as a sole proprietor. It's simple and has no annual fees or extra tax returns. That and plenty of insurance have worked well for me for over 20 years.
All good comments. I did do some reading last night and found that you can shield some assets in a trust to your children so they could have an inheritance. Mr. Cow is right. We did a lot of work for an out of state contractor once and "got stiffed." We didn't get even get a paper - just put at the end of a list of creditors.
