LLC Business safety

[pixelmonkey]

I have not yet discussed this with a lawyer.



With that said, I was looking at a few past law suits and hope to hear some feedback *good and bad* about the following business setup.



L.L.C. Some details might use these as a safe way to operate a business while protecting their personal home and belongings.



What if the following business setup was used?

1.) Detailing Business L.L.C.

2.) Tool Lease L.L.C.



Having a LLC limits what a law suit can acquire. This applies to insurance coverage of the business and assets the business has *including tools and supplies*.

Having a second LLC that is a separate business that is for Tool Leasing would allow for the Detailing LLC to lease polishers, extractors, ect. from them.



The only way a suit would consume both portions would be a class action suit filed on both LLC ; and a justifiable negligence from Tool Lease LLC to be considered for such a suit.



I understand most business insurance coverage has a deductible; time away from a business to sit in a small claims suit cost money; having a customer make fictitious loss claims after you wash and wax their automobile can hurt a businesses exposure.



The Lease option is a safety net for total loss from a LLC without the business owner having loss of tool & supply.



I understand the business ethics for standing by the business name, practices and customer service; but what, other than insurance coverage, have YOU done to protect your business and tools?



curious

chris<pixelmonkey>

 

[C. Charles Hahn]

Interesting concept; not sure if it would be the best idea from a tax standpoint though -- you'd have to report the revenue from the detailing business AND the revenue from the tool leasing business, which ultimately because you'd constantly be recording a lease expense from one business to the other means you're paying double what you would have to by only having one LLC. Only way I could see getting around that is if the lease expense is a tax write-off for the detail business.



The question is this: are you the owner/operator of the detail business with no employees? If so then perhaps you could structure the business so that all of the tools belong to you personally, and you get paid by the business for what you're using to do the job. That's a fairly similar setup to the way mechanics work -- most own their own tools that are used on the job so those can't be gone after if a customer sues the LLC.

 

[imported_shineon]

I to am curious about this ... Im starting a new detail business here in Oregon. I havent talked to a lawyer but from what i understand from research and friends with llc companies you set it up as stated above . With the tools being personal property as well as any other assests i.e. home , car , banks accounts etc.