In this ebook we’ll be discussing what an LLC is. An LLC is a company that protects you as a business owner from the debts and liabilities of the company.
 
Fundamentally, it is an offset of the Corporation. The difference is that the LLC has fewer annual
formalities or as I like to call it, maintenance. For example, Corporations generally require
annual board meetings to be held and minutes to meetings outlining the substantive discussions
at said meetings to be documented and maintained in the company record book. LLC’s do not
have this requirement.
 
Corporations also must list corporate officers such as its chief financial
officer, president, vice president, treasurer, and secretary. States eventually recognized that the
Corporation was a bit much and created the LLC as an alternative for business owners who want
the liability protection without the formal maintenance.
Nevertheless, the LLC is designed to protect the owner(s) from the debts and liabilities of
the Company, that shield can be broken in certain situations. This is called piercing the corporate
veil.
 
Some of the most popular ways in which attorneys can pierce the corporate veil of a
company are: if the company is not properly indemnified by contract, the owner mixes its
business and personal money, or the owners injustice. Being sued is no fun for you as a business
owner especially when your personal assets are on the line.
 
Some people make the mistake of thinking that they can be careless with protecting
themselves from liability because they personally do not own any assets. This is inaccurate for
many reasons. For instance, if you get sued today and have no assets for an attorney to enforce
the judgement on, that does not mean that the judgement disappears. In fact, the exact opposite
arises. That judgement can be put on your credit report. The judgement can also be enforced
against you in the near future when you actually have assets. We as responsible individuals,
don’t have any plans on living paycheck to paycheck. When you go to buy that house, that car,
or gain anything of momentary value, the judgement will be lingering waiting to take it from
you. Depending on the state, judgements can be enforced against you for up to twenty
years after being obtained.