Thoughts on how to structure my business?

Aug 13, 2007

  1. Carpal Tunnel

    Carpal Tunnel New Member

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    Hi. First post here.

    I have an existing business doing bookkeeping and taxes. I am registered as a for-profit corporation and I have an s-corp election with the IRS.

    I am now licensed to sell life & health products.

    I am considering splitting into two separate businesses -- insurance and tax -- and I'm wondering about the best way to protect myself against unknown potential threats of lawsuits, IRS, etc.

    For the insurance business, is it better to be an llc taxed as a corporation, or to register as an for-profit corp?

    Should I even split the businesses?

    Does anyone have any strategy for protecting personal assets?

    I know the tax benefits of a s-corp, but does it make piercing the veil easier?

    Thanks for any insight you may have. I know this is a lot.
    Last edited: Aug 13, 2007
  2. Delta76

    Delta76 Guru

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    Do a search, those questions were answerered not too long ago.
    Delta76, Aug 13, 2007
  3. arnguy

    arnguy Guru

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    Carpal Tunnel, if I were you, I would not spend much time worrying about protecting yourself from the IRS regarding them piercing the corporate veil. I can assure that the IRS can do that very easily regardless of the business structure. During my career with the IRS, I spent quite a bit of time piercing corporate veils to apply the so-called "100% Penalty" against officers, both de facto and de juris, despiteconvoluted methods to create such a veil. A corporate structure will protect you personally from other creditors, except for fraud. LLC does the same, as does a Subchapter S Corporation, except that the taxation passes through to you as an individual----similar to a partnership without the personal liability. In essence, any form other than sole proprietor and partnership gives you a modicum of protection against personal liability. Hope this helps.
    arnguy, Aug 13, 2007