Property Deed?

[wash12]

Closing on a wash and have the option to put title in LLC or personal name what does everyone else do?

I am leaning to put into LLC to reduce personal liability but not sure if there are downfalls to this?

 

[APW]

I have my three washes in three different LLC's.

 

[JGinther]

Due to a hundred years worth of work by thousands of attorneys and case-law, you can sign one document with a pen that magically makes the liability go from everything you personally own to just whatever is owned by the other name you wrote on the document. Due to this logical system and by extension - you would want to remove liability exposure by creating as many of those magical documents as possible to reduce the pot to being 'not worth peeing in.'

 

[mjwalsh]

Due to a hundred years worth of work by thousands of attorneys and case-law, you can sign one document with a pen that magically makes the liability go from everything you personally own to just whatever is owned by the other name you wrote on the document. Due to this logical system and by extension - you would want to remove liability exposure by creating as many of those magical documents as possible to reduce the pot to being 'not worth peeing in.'

My thoughts are & based on what my long term CPA told me ... since courts can override & still hold an individual's personal assets in cases ... sometimes just asking for higher liability limits from your insurance company... can make the most sense.

 

[Robert2181]

CPA's are not attorneys.

 

[sparkey]

CPA's are not attorneys.

Like going to the local bar for financial advice.

 

[PaulLovesJamie]

No offense, but you guys are misinformed.
My wife is a CPA, guess where she was all day yesterday (and for 50-60 hours every year)?
At a continuing education seminar that is mandatory to maintain her license. Topic: corporate law.

A CPA's job (in the context of this discussion) is to help you make the better decision from a financial perspective. Short and long term balancing of risks and costs. From a practical perspective I have found that CPAs sometimes give better advice on legal issues than lawyers. NOT on the technical details of law and lawyering, but high level financial framing.
(As an aside, thats one of the reasons so many CEOs come from an accounting background.)

 

[PaulLovesJamie]

One could say that going to a lawyer for advice about incorporating is like asking the bartender if having a drink is a good idea.

 

[PaulLovesJamie]

Wash12, think of incorporating as though you were buying an insurance policy - insurance against losing something you have in a lawsuit. What assets do you have, what risks do you have. E.g. if you live in litigious cold Massachusetts and dont have floor heat, incorporate, and do it fast! If you are in Arkansas, dont have a McMansion and a fishing boat, run a very tight operation, and your courts are business friendly, buy insurance.

JGinther is correct - incorporating reduces your liability. (reduces, does not eliminate).
Mike is also correct - in many cases, simply increasing your liability limits on your insurance is usually cheaper and can make more business sense.
Both have costs, initial and ongoing.

I'll also go out on a limb here and say that since LLC's have significantly reduced the costs of being a corporation, the majority of car washes are becoming an LLC. If you did a survey I think that would be the majority.

 

[Waxman]

I'm an S Corp. This is my car wash, detail and used car business. My apartments are in an LLC.

 

[Car_Wash_Guy]

LLC then Trust

 

[Roz]

I was always advised to put the property into a real estate LLC and the business into a separate LLC, car wash or any other business where you own the property too. Supposedly it may make any litigation harder and offers more protection. A little more paperwork but provides more peace of mind.