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My husband and I own a retail liquor store in Kansas which

he operates as sole...
My husband and I own a retail liquor store in Kansas which he operates as sole proprietor. We've been checking into an umbrella insurance policy to protect ourselves from liability claims but not sure that's the best route. I recently heard a business should incorporate to protect the owner's personal property. We would appreciate some help on what is the best way to protect ourselves.
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Answered in 5 minutes by:
1/3/2013
Richard
Richard, Attorney
Category: Business Law
Satisfied Customers: 55,803
Experience: 32 years of experience practicing law and a businessman.
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Welcome! My goal is to do my very best to understand your situation and to provide a full and complete answer for you.


Good evening. You are wise to be concerned. Yes, you should form a limited liability entity....either an LLC or a corporation...to protect your personal assets from the liabilities of your store. You can still have the entity purchase a liability insurance policy to protect the assets of the entity, but in all cases your personal assets would be protected. I would recommend either an LLC or an S corporation as both shield you from personal liability and avoid the double taxation of being taxed at both the entity and the individual level. The LLC offers a bit more flexibility for you so I would recommend that. Forming it is simple....i) complete and file a certificate of formation with the Kansas Secretary of State online; ii) obtain an Employer Identification Number from the IRS online; iii) download a simple operating agreement from www.rocketlawyer.com or www.legalzoom.com and modify it for your facts; and then iv) open an bank account using the documentation in (i) through (iii). Then assign all the stores assets to the LLC. You're done!



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Richard
Richard, Attorney
Category: Business Law
Satisfied Customers: 55,803
Experience: 32 years of experience practicing law and a businessman.
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Richard
Richard
Richard, Attorney
Category: Business Law
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Experience: 32 years of experience practicing law and a businessman.

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