There is a fine line between being the owner and being the “business”. And, the difference between them can be blurry at times. However, it is extremely important for small business owners to decipher between the two.
A corporate entity is considered its own being and is treated as its own person under the law. Corporate entities can do things like taking out a loan from a bank, entering into a lease, and/or buying property. The only things a corporate entity cannot do, is go to jail or vote in an election. Other than that, it’s provided protections just like a human being.
The most important reason to create a corporate entity when starting a business, is to shield yourself and your personal assets from liability. However, to ensure that protection, there are things that must be put in place to ensure that others cannot “pierce the corporate veil” to get to those assets. In other words, you want to limit your exposure involving third party claims to the assets of the company.
To learn more, take a few minutes to watch the video of Small Business Coffee Break with Dopazo & Associates Insurance, featuring Lillian A. Ser, Esq. If you need assistance in creating your corporate structure and/or ensuring that your existing business has all the bells and whistles in place for asset protection, please contact Ser & Associates today at 305.222.7282.