So how do they determine if I have paid personal obligations, sepona my records?
yup. all discoverable in a law suit (by IRS or state gov. as well)
How long after my last instance does it take to erase the missuse or do I have to form a new LLC?
That’s a pretty ahiry legal question. My GUESS would be if it happen before the subject transaction you have “dirty hands” and not if it happened after.
For instance, early in my LLC I moved money into my personal account and wrote a check from there. I have also paid for supplies with my personal account and later transfered the amount back into my checking.
Have I missused my LLC?
note if you have a promisory note on your books and paid the LLC interest. And you need a recipt to authorize the reimbursement of “personal” money.
I am a landlord and am experiencing my first law suit. As a novice, I have done everything I can think of to protect against suits pertaining to falls or landlord neglect. And this situation has shown me that there is no way to totally do so.
Given that, is it just part of the business to be sued?
If so does having an LLC really protect me and my partners from loosing our personal wealth?
Don,
Anyone can be sued for anything, whether they are in the “wrong” or “right”. Just because you’re sued, doesn’t mean they will win. If they have no basis for suing, I would counterclaim for legal costs, fees, and expenses, among anything else you can counterclaim for, if any. If they know they’re going to get their legal bill plus yours if they lose the case, then they may take a step back and re-think things. That’s my two cents. Oh, and for the future, you may want to ask your insurance agent about an “umbrella policy” too.
you may have heard of piercing the corporate vail? The same can be done w/ and LLC. Misuse such as co-mingling funds, paying personal obligations w/ LLC funds opens you up to being pierced.
So how do they determine if I have paid personal obligations, sepona my records?
How long after my last instance does it take to erase the missuse or do I have to form a new LLC?
For instance, early in my LLC I moved money into my personal account and wrote a check from there. I have also paid for supplies with my personal account and later transfered the amount back into my checking.