To incorporate or not.

[Wimblees@aol.com]

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In a message dated 4/27/03 4:32:16 PM Central Daylight Time, 
mfarrel2@tampabay.rr.com writes:

> Basically, if you are on the up-and-up and trying to do the best you can and 
> something goes wrong - you are protected from personal lawsuits if you are 
> working for a corporation.
> 
> Terry Farrell
>  
> 
It's true that if you're working for a corporation, and the corp. gets sued, 
the corp. has to pay, and the individual cannot be held liable. In a sense, 
the stock holders of the corp. pay the bill. If you are a stock holder in a 
corporation, then you are in a sense paying, by the fact that your dividend 
might not be as big. If you are the stock holder of a privately held 
corporation, then the stock holders also have to pay. The stock holders have 
to take the money either out of the profit of the business, the assets of the 
business, or, if there are none of those, out of the stock holders pocket. 

Now we're down to a privately held corp. where just you and your wife are the 
stock holders. If you, and your wife, are the only stock holders of the 
corporation, and the corporation gets sued, guess who has to pay? And it 
doesn't make any difference where the money comes from. The stock holders 
have to pay. Not only the judgment, if there is any, but also the legal fees. 


Wim

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