21h • General discussion 🗣️
Will My LLC really protect me from lawsuits?
When helping clients form businesses, often I get asked: "Will my LLC really protect me from lawsuits?"
Here's the truth nobody talks about. An LLC creates a legal wall between YOU and your business.
But here's what most people get wrong:
• They think it's bulletproof armor (it's not)
• They assume it protects personal assets automatically
• They believe registration alone is enough
The reality? LLCs provide LIMITED Liability Protection. Key word = LIMITED.
Here's what it actually does:
✅ Shields personal assets from business debts
✅ Protects you from partner's mistakes
✅ Separates business lawsuits from personal lawsuits
But here's what it WON'T protect:
❌ Personal guarantees you signed
❌ Your own negligent actions
❌ Mixing personal/business finances
The biggest mistake I see? People form an LLC then treat it like their personal piggy bank. They don’t keep good records of money flowing in and out of the LLC account.
You MUST:
• Keep separate bank accounts
• Maintain proper records
• Follow formalities
• Never co-mingle funds
Remember: An LLC isn't a magic lawsuit shield.
It's a business structure that requires discipline.
The protection is in the PROCESS, not just the paperwork.
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Will My LLC really protect me from lawsuits?
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