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RE: Was Health Insurance for Engineers - Now incorporation

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A sole proprietorship is very dangerous for anyone even if a one man
operation. A Sole proprietorship means that you are personally liable
for anything that goes wrong, bad idea. No matter how you try and slice
it.

I always recommend my clients that when they buy real estate primarily
investment to place it in an LLC so that they are not personally liable
for problems or incase their neighbor or tenant decides to sue them for
a million dollars. This way the liabilities are limited to that piece of
property and not the others or any personal property. Also the tax
deductions go beyond the 25K max deduction for losses against real
estate. 

I was surprised to here that many geotechnical engineers do not own
property because they are concerned about litigation and liabilities. I
understand that, but the way around that is buy the house, or transfer
the house as a LLC and it is no longer personal property it is owned by
a separate entity. The owner is just a officer of the corporation so
this shields the property from litigation. Some sophisticated Escrows
Companies can handle the whole transaction or transfer from start to
finish even registering the LLC.

Although this is very complicated and I am not trying to write a book
within this email but in a nut shell if you are not incorporated you
should be. It's cheap and quick.

Here is where I got my LLC. They are a solid company and have been
around a long time.

https://www.amerilawyer.com/sixreasons_discussion.htm

https://www.amerilawyer.com/order.htm

Kevin
Los Angeles



-----Original Message-----
From: Paul Feather [mailto:pfeather(--nospam--at)SE-Solutions.net] 
Sent: Monday, June 06, 2005 11:03 AM
To: seaint(--nospam--at)seaint.org
Subject: Re: Was Health Insurance for Engineers - Now incorporation

For a one man operation, there is very little benefit in incorporation
as 
opposed to sole proprietorship.  This does not mean this is no
additional 
protection, just the benefits are limited and only if you structure the 
balance of your business to take advantage of the benefits.

Incorporation does not provide protection for professional liability. 
However, there are limited tax benefits even for a one man show, as well
as 
shelter from other forms of liability.  If your company car is
corporately 
owned and you are involved in an accident, your personal assets are 
protected whereas they would not be under sole proprietor, as an
example. 
Talk to a good lawyer and tax attorney.  The critical aspect of
corporate 
protection for a one man operation is the corporation is "closely held"
and 
the corporate shield can often be lost without proper separation of
business 
and personal.

If you have other people in the firm, incorporation is immediately more 
beneficial.  All forms of job related liability other than professional 
liability will be sheltered from your personal assets.

In addition to liability and tax issues, incorporation also provides an 
entity for transfer of ownership and a separate value in the event of
the 
proprietor's demise.



Paul Feather PE, SE
www.SE-Solutions.net
pfeather(--nospam--at)SE-Solutions.net
----- Original Message ----- 
From: "Polhemus, Bill" <bill.polhemus(--nospam--at)tyson.com>
To: <seaint(--nospam--at)seaint.org>
Sent: Monday, June 06, 2005 10:34 AM
Subject: RE: Was Health Insurance for Engineers - Now incorporation


> -----Original Message-----
> From: Gautam Manandhar [mailto:Gautam_Manandhar(--nospam--at)ci.richmond.ca.us]
> Sent: Monday, June 06, 2005 12:20 PM
> To: seaint(--nospam--at)seaint.org
> Subject: Re: Was Health Insurance for Engineers - Now incorporation
>
> Jordon:
>
> You indicated that your are a one-man team and are incorporated.  It
is
> my understanding that because you are a one man team, the protection
> from loss of personal property generally provided by incorporating is
> not avaialable for a one-man team.  Could you shed some light on the
> benefits of incorporating.
>
> -----\Original Message-----
>
> Prior to my reading Joran's reply I'd like to put in one of my own. I
> was continually told by every CPA or attorney that cared to give me an
> opinion on the matter--free or paid--that there really was no
advantage
> for a single-person practice to become incorporated. In fact, you
avoid
> a whole raft of expenses like business licensing and even payment of
> fees for "company registration" that has become all the rage among
many
> states now (and is, IMO, just an excuse to badger you for more money;
> "user fees" is the new taxation, often without representation since
> often the enabling legislation doesn't address how much the fees ought
> to be, leaving that up to the bureaucrats. But I digress).
>
> Yet, just about every person I ask, that is in business, is
> incorporated.
>
> I have finally concluded that "incorporation" is sort of like having a
> website or a set of business cards: It gives you a perception of
> legitimacy.
>
> At least, no one, even among "the incorporated," has been able to
> explain to me why they decided to incorporate other than in vague
terms
> like "it just seemed like I should."
>
>
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