Limited Liability

Discussion in 'Growing and Managing a Business' started by hcted, Jul 23, 2010.

  1. hcted

    hcted
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    I wanted to know at what point of a business should one become a Limited Liability member? Such as an LLC.
     
  2. Fergal

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    hcted I don't know the specific requirements in US law, but it in Ireland you really don't need to form a limited liability company until your business has grown to some size or your business has come to a stage where there are significant risks involved.

    Insurance is always important in business, but it is even more important when you don't have limited liability, because all of the business risk comes back to you personally. Hence, you really need the business to be insured for all possible losses and risk.

    If you are doing something like web design and there are not big costs involved, you probably don't need limited liability until you begin to employ other people. It's unlikely that type of business would have significant losses or risks that will come back to you personally, so you probably don't need the additional protection that limited liability will give you.

    However, as I say I'm not familiar with the situation in the US so you should really take some professional advice on the topic. Do you or perhaps a family member have an accountant or a lawyer that you could speak to? Or perhaps there is a local government enterprise / business support agency that you could speak to.
     
  3. stevenricherd

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    Its all depend on your business position and market risk, if you are covered with insurance then there is no need of limited liability, if there are risks of getting loss then go for it, it is good to have limited liability.
     
  4. Fergal

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    I agree that it is very important to have insurance and that insurance can protect you against a lot of the risks that you could potentially face. However, it's important to note that limited liability can help protect you from certain risks that insurance won't cover, e.g. the risk that the business makes a loss.
     
  5. StarbidAuctions

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    Like everyone else has said it all depends on the kind of business you are running also make sure you look into it fully as there are alot of differances between selfemployed and a limited company such as how you can pay yourself and paper work etc but like mentioned its the best option if you want to play it safe.
     
  6. CloptonCapital

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    When the liability of being sued is real. Any business where there is a chance someone could be hurt or die and you're involved.
     
  7. jumeira123

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    Professional Business Consultant

    Consult a business adviser.He may be able to guide you through the whole LLC set up procedure.
     

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