Estate Planning

Florida LLC's and Asset Protection and Legal Zoom

By David M. Goldman

Florida LLC's are one of the best choices for a new business entity. When thinking of forming a company, may people only look for low taxes and protection from liability.

Unfortunately, many are misinformed as to the protection that a corporation can offer. While it is true that a corporation and a Limited liability company can both protect a persons personal assets from corporate liability (in most cases), only the properly created Florida LLC can protect your business assets from personal liability.

If someone sues you and wins, they can take your stock in your corporation just like they could take your stock in GM. Once they own your stock, they can sell the company, fire you, and liquidate the company. If this happened to you it could cost you your livelihood.

To protect against this many people now use limited liability companies in Florida. If the LLC is properly created you can be protect from judgments, reduce the risk of lawsuits, and still be taxed as a partnership or an S-Corp. Yes you can be a LLC but choose to be taxed as a S-Corp.

While legal Zoom will let you create a Corporation or LLC online in almost any state, they can not evaluate your personal circumstances, and make recommendations on how to set up the LLC to offer you the protections under Florida Laws. I have seen many LLC's created by Legal Zoom which failed to take advantage of these protections.

In addition, I have noticed that the people who use these services do not understand the importance of acting like a business entity. They rarely have meetings or authorize actions by the board members or officers. These actions can create prevent the business entity from protecting the owners, directors, and shareholders from personal liability.

Part of what your lawyer should do is understand your circumstances, and design an entity to protect your needs and interests. At the same time, the attorney should educate you on how to take advantage of the protections offered. just because your form an LLC or Corporation does not mean you are protected.

To discuss how to use your business entity to protect your personal assets and protect your business assets from the owners personal liability you should Contact a Florida Business and Asset Protection Lawyer

Full post as published by Florida Estate Planning Lawyer Blog on June 20, 2008 (boomark / email).