Needing a corporation
If you have even one employee, you probably will want to look into incorporating your business. Having a corporation can possibly provide you with a tax benefit. (This does not constitute tax advice; consult your taxation specialist.) It can also protect you from losing your own personal assets -- like your home -- if someone sues your business.
If someone slips and falls at your business, or your employee alleges that you didn't pay overtime, this could turn into a lawsuit, and then eventually a judgment. And without a corporation, they can come after you.
I have a corporation. Is there anything else I should do?
Yes! If someone can "pierce the corporate veil," then they can get at you personally. Piercing the veil means that they would need to demonstrate that the corporation is a sham. You'll need to demonatrate it is a valid, legal entity.. To uphold the corporation's validity, you'll need to demonstrate that you maintain the formalities of the corporation. These include holding annual meetings, maintaining corporate minutes, etc.
Many small corporations don't observe these formalities. It is often the case that a corporation is initially formed and the Corporate By-Laws and Minute Book are shelved and forgotten. This careless approach creates risk and defeats the purpose for which you incopporated in the first place.
If you have not done the "formalities," you may be personally exposed.
Don't wait! Protect your Personal Assets now!
Call a local neighborhood Santa Clarita Attorney now to help you get up-to-date on your legal obligations and help protect yourself from a lawsuit or attack that might otherwise be able to get at you, your family and your home.
