Setting up a corp. questions

[moe]

Sorry I took so long to respond. I was at the truck show, just got back. In this case it was in their best interest and we were adamant about not settling, They were so happy that we won they reimbursed us for all losses that wasn't covered by our policy. Just to illustrate why ins. companies don't like to settle, in closing the plaintiffs legal team asked the jury for eight million dollars, the jury awarded zero. We won right. My insurance company spent about $400,000 for all expenses from beginning to end(a period of about 14 months) and felt that was wonderful. The bottom line is it cost them $400.000 to win a case that should have never of gone to court.

[GMAN]

Hopefully, their willingness to fight will send a message to the next lawyer who thinks that he will get a quick shake down of an insurance company. Payoffs from insurance companies only result in our premiums going up. There is no telling how much money they will ultimately save by them fighting and winning in court.

[Musicman]

Lawyers do not just go after the easy money; they go after ALL the money. If there is an incident, you, your company, your dog, and your neighbor will be named in the suit. If the jury awards an amount greater than your coverage, your assets are fair game. If the O/O is found negligent, no legal structure is going to protect his personal assets. Most people woefully misunderstand the legal process in these cases..... No matter who does your tax filings, YOU are the responsible party.

I'm set up as an LLC simply for the options it gives me in expanding my business. IMHO anyone who has more than one truck should be set up as an LLC, as there really is no difference in tax implications since it is a pass-through entity. LLCs offer most of the benefits of a full corporation without the majority of the record keeping headaches. To protect your personal assets (the really big ones, anyway… house, investments, etc.) all you need is a properly constructed trust.

As an aside; this particular issue has been flagged as being a high priority for auditors.

It should also be noted for those less informed, that the home office exemption is one big, fat red flag to the IRS and it generally doesn’t reduce your tax liability by a significant amount. IMO, NEVER take this deduction.