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Recent Piercing the Corporate Veil questions

My partner in our LLC has embezzled funds (taken ATM

My partner in our LLC has embezzled funds (taken ATM withdrawals to use for gambling) for 5 years. How do I handle this? I am not interested in pressing criminal charges but I also want to eliminate any negative tax consequences on me.JA: Can you tell me what state the LLC is registered in?Customer: MDJA: Have you talked to a lawyer yet?Customer: briefly but they weren't much help. They said there is a challenge when it is a partner since they have some "rights" to the funds. What about fiduciary responsibility etc?JA: Anything else you think the lawyer should know?Customer: We are planning on having her sign off of the corporation immediately.JA: OK. Got it. I'm sending you to a secure page on JustAnswer so you can place the $5 fully-refundable deposit now. While you're filling out that form, I'll tell the Corporate Lawyer about your situation and then connect you two.

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legalg

Juris Doctorate

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I began a discussion with , as listed below. I asked

I began a discussion with Barbara, as listed below. I asked a followup question to her response, but she was offline, apparently.My wife and I own a home, in which she does licensed day care. I am about to lose my job. My wife does not make enough money to support us and our home. We are going to be downsizing considerably. Ideally, we would like to buy a much smaller house, which we could pay for using my wife's income,before our credit rating (over 800) goes down. What are the best ways for us to protect our credit rating in this time of transition?26 May 2016 11:4126 May 2016 12:11BarbaraFinancial ProfessionalWelcome to Just Answer. My name is ***** ***** I will be happy to assist you.You are wise to be proactive in this situation. Your first priority is to list your house for sale as soon as possible since this is the best time of year to sell a house so you can downsize and purchase a smaller, less expensive house.You will also want to continue to pay your bills on time. The following link contains an excellent guideline regarding prioritizing your bills:http://www.moneycrashers.com/bills-pay-off-first/Once you have reviewed the information, please come back to me here if you have any other questions or concerns.Thank you and best regards,Barb26 May 2016 12:30Dear Barb,Thanks so much for your quick response. We are attempting to be proactive.One thing we were wondering was whether we should consider creating an LLC or family trust that would own the house? How would that work?Thanks again!

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Law Educator, Esq.

Attorney At Law

Doctoral Degree

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Business startup question here.My father is getting ready to

Hello,Business startup question here.My father is getting ready to retire in one years time. He has always wanted to set up his own licensed and insured general contracting business. He wants to get it up and running before he actually retires. I am able to help him to do this forapproximately 20 hrs per week. The work is definitely there. We live in Pennsylvania. The general idea is that I would help him get this business off of the ground working about 20 hours a week at minimum wage. I don't want to make him pay me any more than this but I would be have to be an employee. The only employee until he retires.What is the best way to go about this and which is the best form for the company (SCorp, LLC etc.)? Does he need to also pay himself even though he probably won't be actually performing any "work".I will have some follow up questions too if that's OK.Please provide a detailed answer.Thank you for your time

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Richard - Bizlaw

Juris Doctor

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My corporation is being sued in a bankruptcy case and the

My corporation is being sued in a bankruptcy case and the trustee is asking for summary judgement. The summons only named my corporation and not me personally. Once a judgement us rendered is there anyway the trustee could go bac and sue me personally?

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Irwin Law

Juris Doctor JD

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BACKGROUND: I formed a SCorp 20 years ago in MI with

BACKGROUND: I formed a SCorp 20 years ago in MI with virtually no money (I think $100 or so). It was a consulting company run from home so no capitalization was needed. I took salary when I could and did not take when there was no money.For last 20 years I have operated it as a one person LLC primarily doing consulting work and branched out into few projects where the Scorp became share holder in other LLC. However the other LLC paid the S corp and the SCorp paid me salary when it could. In months when S Corp was running low I did not draw a salary. As director (and only share holder) of the Scorp I recorded in the minutes that salary to be paid only when S Corp could afford.I am now adding a small craft business under the SCorp where we will be making cushions. The cushions are different from others in that a person can zip them open and add or take out stuffing. I have looked for product liability insurance and General Liability insurance and am unable to find for home based craft manufacturing business.I have diligently kept business finances and personal finances separate and never co-mingled the monies. After salary I have two month worth of salary as reserve in S corp rest I take out as dividends (small amounts)QUESTIONS: My questions are;1) In the event someone sues me for product liability (small chance given it is cushions but still).. will the fact that I have only 2 months worth of money in bank (am I under capitalized) and no insurance expose me to risk of corporate veil being pierced.2) How strong is corporate veil protection in Michigan compared to other states in USA3) The fact that my cushions allows people to access the stuffing (by opening the zip) expose me to additional liability ? If yes what can I do to protect myself

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TJ, Esq.

Juris Doctor (JD)

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10,320 satisfied customers
I have another question .The business is home care for

I have another question for you.The business is home care for the mental disabled,The vehicle we purchased to transport are clients was in my wifes name.We transferred the title to the corp for legal reasons,We want to pay are selves back for this vehicle from the business account.My tax account told me to just type up a letter stating that funds from business were used to pay are selves back .Is this the correct way to do this

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Richard

Owner

Doctoral Degree

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46,272 satisfied customers
I live in Ohio and I am self employed as a sales

Hello. I live in Ohio and I am self employed as a sales broker. I set up my company as an Ohio LLC, but it is disregarded as I am the only owner. I have no employees. I did apply for an EIN number and all of my business income is on 1099s. I have been in business since 2011. I just read that I might need a business license or other registrations, but I do not sell any products. I just get paid for my services. Is there anything else I need to do to be properly set up?

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Loren

Juris Doctor

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35,384 satisfied customers
I have a one person S corp. I do consulting work under this

I have a one person S corp. I do consulting work under this Scorp and this Scorp is a holding company in other LLCs (small businesses). In other words I participate as active partner in other LLCs through the S corp. My ownership (as the S corp) in other LLC is from 33% to 100% (that means the S corp is a sole owner in the LLC).I maintain very good minutes of meetings for the S corp and separate bank accounts.In the event of a product liability lawsuit (one of the LLC is into manufacturing) Does this type of structure provide me proper liability protection. I mean in the LLC the first line of protection is the LLC and if that is pierced then the Scorp.What else can i do to make sure the corporate veil is strong so that I as an individual is not dragged into the lawsuit personally. As I mentioned I keep good meeting minutes, have a separate business account, do not co-mingle personal funds with Scorp funds, have a part time book keeper and CPA. etc.

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Law Educator, Esq.

Attorney At Law

Doctoral Degree

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I don't know a lot about business finances or taxes but I'm

I don't know a lot about business finances or taxes but I'm trying to learn. I've been reading about different strategies to grow my income stream and have been looking to go into business. Right now I have a full time job as a nurse but I'm working as a commission agent for a used car dealer. Basically I adds me into his group which gives me the legal standing as a dealer and gets me access to buy and sale at dealer only auctions. I keep 100$ of my profits and provide the dealer with a monthly fee. At years end he will send me 1099 for my profits. I trying to figure out how to do the set myself up for the least tax and legal costs and maximize my profits. I've considered an LLC and purchasing all qualified expenses through it and filling my taxes on only my net profit after I've claimed all that I can as expense to cost of doing business but I don't know if this is even legal. Do you have any advice? I have future business goals but none that can start until I make and keep as much money as I can here firstJA: OK. The Corporate Lawyer will need to help you with this. Have you consulted a lawyer yet?Customer: That 100% of my profits not only 100$JA: Is there anything else the Corporate Lawyer should be aware of?Customer: Not yetJA: OK. Got it. I'm sending you to a secure page on JustAnswer so you can place the $5 fully-refundable deposit now. While you're filling out that form, I'll tell the Corporate Lawyer about your situation and then connect you two.

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Richard

Owner

Doctoral Degree

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46,272 satisfied customers
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