I need some clarification on the LLC protections I will receive as a single-member LLC in New York State. I'm unclear as to what kind of action can be taken against a single-member LLC that defaults on a loan, credit card, etc. Any information would be appreciated!
4 Answers from Attorneys
While the LLC may be responsible, the individual member is not personally responsible, unless he guaranteed the debt.
Single member LLCS provide no protection in the event of default. If you wish to engage in some form of asset protection seek legal advice but do not rely on a single member LLC for protection.
As noted, if you are someone personally guaranteed a loan or credit card, etc. then you are responsible. If these are debts and obligations deriving from operating the business with no personal guarantees then you would not be personally responsible.
If you need further clarification, I suggest that you consult with a lawyer in private and discuss your objectives in more detail. You can start by calling around to several for a free phone consultation, get some insights then pick the best fit to work with.
If you would like to discuss further over a free phone consult, feel free to contact me anytime that is convenient.
Our firm is now referred by the American Bar Association (see under the New York section):
DISCLAIMER: this is not intended to be specific legal advice and should not be relied upon as such. No attorney-client relationship is formed on the basis of this posting.
As long as you do not personally guaranty anything and all potential liabilities are solely in the LLC name, you should be protected .
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