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I am a member of an LLC that's owns several rental

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properties. I am shopping...
I am a member of an LLC that's owns several rental properties. I am shopping around for an insurance company today and provided my LLCs information and tax ID. I was asked by the insurance company to provide my personal social security number and was told my tax id was needed. The property is owned by the LLC and is up to date with filings. Is it necessary to provide my social security number? If so, does that pose any personally liability to me as opposed to the LLC only being at risk?
I appreciate your time in advance.
-Shawn
Submitted: 1 year ago.Category: Tax
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Answered in 4 minutes by:
9/14/2016
Tax Professional: ABC Accounting Group, Certified Public Accountant (CPA) replied 1 year ago
ABC Accounting Group
ABC Accounting Group, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 714
Experience: Business Consultant/Accounting Manager
Verified

Hi. Insurance companies require the social security numbers of the members. Due to your LLC status, you should not have personal liability, unless there are extraneous circumstances, for example:

  • Claims arising out of an act or omission by the member, such as the member's own negligence, fraud or illegal act
  • Claims arising out of a contract, particularly one that was personally guaranteed by the member
  • Claims based on the concept of "piercing the veil" of the LLC
  • Liability for consenting to or receiving a distribution in violation of the LLC's operating agreement or the applicable LLC statute
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Tax Professional: ABC Accounting Group, Certified Public Accountant (CPA) replied 1 year ago

If you have any questions, let me know. If not, a positive rating is very much appreciated.

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Customer reply replied 1 year ago
Thank you, ***** ***** legal but see you are an accounting group. Should this question be forwarded to an attorney ? Or do you have attorneys on staff?
Tax Professional: ABC Accounting Group, Certified Public Accountant (CPA) replied 1 year ago

I can actually forward this over to an attorney if you want.

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Tax Professional: ABC Accounting Group, Certified Public Accountant (CPA) replied 1 year ago

Hi. I sent this to one of the attorneys on staff. Best Regards.

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 1 year ago
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 12,885
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Hi - I can help here. My name's Lane.

...

I hold a law degree, with concentration in Tax Law, Estate law & Corporate law, an MBA, with specialization in financial accounting & tax, a BBA, and CFP & CRPS designations, as well - I’ve been providing financial, Social Security/Medicare, estate, corporate, non-profit, and tax advice, since 1986.

I would agree with the information above, with two exceptions (additions);

...

(1) "Claims based on the concept of "piercing the veil" of the LLC" is a VERY broad area, that has to do wth everything from being sure that you've operated according to your operating agreement, HAVING an operating agreement, being sure that you've operated COMPLETELY in compliance with the LLC laws of your state's corporate (or LLC if it's developed) code, not commingling assets, alter-ego theory, etc. - again a VERY broad area that could never be fully discussed in this venue, and

...

(2) The insurance company's asking for your social security number is ***** policy/underwriting choice that each company makes. There is no legal requirement to do so. What's important THERE is to read the contract and see whether the insurance contract holds you personally responsible in any, including contingent liability, manner.

...

Hope this helps to clarify.

...

Let me know if you have questions.

...

Lane

..

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Lane
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 12,885
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Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986

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