When you own a business, the goal is simple: if something goes wrong in the business, it should not reach your home, your savings, or your family's security. Getting there takes more than just forming an entity.
A properly formed LLC or corporation creates a legal separation between you and the business, so business debts and claims generally stay with the business. But that protection depends on respecting the separation.
Courts can disregard the entity, sometimes called piercing the corporate veil, when owners mix personal and business funds, skip required formalities, or leave the business undercapitalized. Keeping separate accounts, signing in the company's name, and meeting California's filing requirements all help preserve your shield.
Good contracts, the right insurance, and sometimes additional structures add further layers. We help owners set this up correctly and keep it intact as the business grows.
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This article is general information, not legal advice, and does not create an attorney-client relationship. Estate and business law change and depend on your specific situation. Speak with Donald W. Flaig before acting.