Incorperating LLC or S Corp.?

Discussion in 'Ask An Owner Operator' started by showoff, Feb 8, 2008.

  1. showoff

    showoff Bobtail Member

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    Dec 28, 2007
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    Starting back up in the trucking industry and I had an S Corp in the early 90s' but in the late 90s' got out for a job at Chrysler. So the corperation has laid idle since. And I have moved to a different state. Starting back up I want to be incorperated but not sure which way to go. Or is it really important other than from a tax standpoint.
     
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  3. snowman76

    snowman76 Bobtail Member

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    If it a small comapny with you at the helm , I would do a llc corp , its alot cheaper, from what was explained to me , as i am getting my things together to do trucking under myself also
     
  4. MedicineMan

    MedicineMan Road Train Member

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    depends what you plan to do. If you are just going to be a one horse operation there isn't much difference. And from what my lawyer tells me there really is no protection with this sortof operation either. If someone wants to sue the company they will sue the board too.
     
  5. Gazoo

    Gazoo Resident Mental Patient

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    I did an LLC but am not sure if I should've just left it alone.
     
  6. im6under

    im6under Heavy Load Member

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    Feb 13, 2007
    iowa
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    A true llc/s corp will divide personal from corporate assets. surprizingly most people don't have any assets... so in that respect medicineman is correct....

    but

    if you have nice house, mostly paid for (300k house you owe 400k on is not an asset).

    I mean real property... 40 acre farm free and clear, 300k house with a 100k left on the mortgage, and you have 50k cash in the bank with 200k in stocks and bonds... then you are a moron if you go trucking as a sole proprietor...

    you are still a moron if you have all of these assets and go trucking on an illegal log and run into a school bus full of kids.

    the corp route protects legitimate businesses. If the truck goes broke and you owe 50k on it plus 10k in business expenses they can't force you to sell your house or attatch your future earnings.

    If you have a wreck and cripple a doctor he can take your paid for truck and that is about it... once again assuming you haven't left yourself personally liable (70 in a 40, over weight 10k, driving 16 hours straight).

    corps are real protection for real businesses, they are extra paper work for fly-by-night wanna play truckers.

    If your only asset is a house you owe to much money on and the truck loan is collateralized with the house.... well ya was already screwed to the wall when ya signed...:biggrin_25523:
     
  7. MedicineMan

    MedicineMan Road Train Member

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    I'm starting a company. My wife is a legal assistant for a corperate attorney and a trial lawyer. This has been a big topic of discussion around here for a few reasons. The trial lower has cited case after case where the corperate barriers have been broken by lawyer. the short of it is this. If you mess up any lawyer worth half his weight in salt can sucessfully come after YOU as a person and your company.
     
  8. Roadmedic

    Roadmedic Road Train Member

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    There is no such thing as a true LLC. All LLC's are the same.

    Consider that you are a company driver and have an accident whether legal or not. The attorney for the injured party will name the trucking company and the driver in the suit. You are now being held liable and don't own the company.

    Now change the issues to the LLC and you as the driver. You are now going to be named in both ways. All assets are now at risk.

    When a company is investigated for ownership by an attorney, they will find the owners to be one owner or two is jointly owned by a spouse. They will automatically name the stockholders as well.

    No attorney is going to miss going for the max in a lawsuit.

    It also does not matter on liability issues in the naming of the suit whether legal or not. They will go for higher amounts if illegal, but you will be named either way.
     
  9. blackf3504dr

    blackf3504dr Light Load Member

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    Sep 9, 2006
    Leesburg, Fl.
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    Add to this your LLC will not have the credit rating to get a loan WITH OUT your signiture ! That means you are responsible for ALL financial affairs of the LLC, which means the bank or lawyer will come after you and your personal assets ... As an O/O an LLC or S Corp is of very little use because it's too easy to tie you to everything involved with the truck/business . It's much too easy for an attorny to "pierce" the corp. vail . Save the money you would spend setting up a corp. and go with a "sole propritor" instead , no extra paper work or Filings to do ether. Just use a DBA ( doing business as ) or in some states it's called "fictitious name". When I ran as an O/O I ran under a DBA, I think it cost me $50 to register my co. name for 5 years (Michigan).
     
  10. snowman76

    snowman76 Bobtail Member

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    Feb 6, 2008
    poconos pa
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    if you want to save your ssests, or yourself, spend the 3 grand in nevada and get a full INC and ge then automatically set up for your buisiness to get credit and more credit, you still have to sign papers for a loan but,, if something happends you personally ie house savings investments will not get touched ..
     
  11. Roadmedic

    Roadmedic Road Train Member

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    Same arguement as the LLC. A good attorney will note the number and names of the shareholders. Also, as a driver you will also be named. There is NO way to shield the assets during a law suit. You are better off getting an umbrella policy to shield the assets.
     
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