What Kind of Business to form

I’ve recently completed training through Internachi and am licensed as a Home Inspector in the State of Florida.
I’ve read Internachi articles on types of Companies to form ie. Sole Proprietorship, LLC, LLP, Corporation, Subchapter S Corporation,…
The concensus is that the purpose of forming an LLC, LLP or Corp is to limit liability of an unfavorable judgement in a lawsuit to the assets of a business entity other than my personal assets.
Florida Statute 468 states " … nor shall any individual practicing home inspection services be relieved of responsibility for professional services performed by reason of his or her employment or relationship with a corporation or partnership".
If this is how I read it then the above discussed business entities offer no protection of my assets ?
I have $500,000 in GC liability insurance.
I do not have E&O insurance but that may be a better investment than the cost of forming a business entity other than a DBA ?
I do not expect the business to “grow” to multiple inspectors or employees.
I do not inspect the business to acquire a large number of assets.
I would like to minimize the number of filings and tax forms and reporting I need to do.
How do I make this decision w/o investing thousands in lawyers and accountants ?

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Why does S-Corp seem so attractive to you ?


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What do you see as the “true liabilities” of a home inspector

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Here is an article that you should read. Do not rely solely on a corporation to protect you and your personal assets. The courts have changed greatly over the years in regards to this type of protection for personal assets. Unless you understand the requirements for separation of your personal and business dealings, everything is at risk.


Are you LLC or INC?

If you are an LLC, S Corp of 1, you can not hide from liability because it is still “U”!

When your company is more than just “U”, then the protection begins. You are protected from someone working “as” you when “they” screw up. But it still can come back around if you “should have” controlled “they” and prevented the screw up.

Some of this stuff costs you more than you would ever save if you got in a lawsuit. “U” (or whatever you want to call yourself) must answer to “them” if things go south.

As pointed out here, we get a lot of complaints in this industry. But the actual law suits are a much smaller number than the complaints.

If your LLC is more than “U”, it will protect “them” from “U” if “you” screw up.

You can run, but you can’t hide.
Nowhere are they going to let you form something where you are exempt from liability if “U” Screw It Up!

Ask your Insurance Provider. It has a lot to do with what State you operate in.

I formed my LLC through Legal Zoom

Neither. Sole Proprietorship. Many have started an LLC or S corp thinking their “personal” assets were protected from lawsuits as a result. I would venture that 95% would be shocked, should legal action take place, that failure to act as an LLC or S Corp AT ALL TIMES, will throw your protection out the window.

“Piercing the veil” is the first tactic that attorneys will use in going after your personal assets. Most inspectors here will not have the paperwork to prove they are not one in the same with the LLC or S Corp. or they will have failed to fully act as a corporate entity and unknowingly voided their supposed protection.

Thank You. That’s how I read it also

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Sorry Nathan. You are full of ****.

I just sat through a long presentation on exactly this issue by a liability attorney that specializes in this practice. “Piercing the LLC corporate veil” was the exact issue being discussed. You may ask a judge to be released but it just doesn’t happen automatically. You have to prove you are separate from your corporate entity. The attorney that specializes in this side of the law will be in your books, in your corporate records, corporate finances, in your personal finances and checking every nook and cranny. If you failed to fund your corporation adequately, you fail. If your corporation doesn’t have any assets, you fail. There are numerous reasons that the corporate veil can be pierced.

That being said, the lawsuit may have to be a pretty good size in order to spend the time and money involved in the process. But to blindly state that “you motion to dismiss yourself as a party, you go in and tell the judge nobody wrote you a check personally and the contract was written with another party to the suit, and you’re out of it.” is bullcrap.

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Wow. From home inspector secretary, to vendor to marketing guru and now a legal eagle… How impressive.

I will continue to listen to my attorney before you. I suggest everyone here do likewise. I just hope that .01% isn’t against someone that took your advice.

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It is not fear mongering. It is telling people to perform their due diligence when forming, and running their company. To blindly believe that a corporation, regardless of type, will ALWAYS protect you personally, is wrong. It will not.

No idea how many Corporate VEIL piercings there may have been. But the corporate protection mentality is not unique to home inspections. Many people in various industries have the same belief. It does not matter to me what anybody else does with their business. Due diligence for your specific business entity is the rule of the day.

If I were to be involved in suing a business that was an LLC, you bet your bottom dollar I would be going after them personally as well. Let no stone go unturned.

So set me straight. Others have asked, “when were you a home inspector or when did you perform your last full home inspection for a fee?” I have never seen you answer the question. You took appointments and worked in the office, correct? You are a vendor, correct? You are an author and are partaking in the marketing tour, correct? As for your “had one all the way to appeals”… a small claims court has “appeals”. Almost every level of court has some form of “appeals”. We could be talking apples and oranges.

Back to installing my new flooring.

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