Updated almost 6 years ago on . Most recent reply
Protection of core assets
As far as business goes in the LLC vs S Corp vs leave in personal name question I am probably thinking of going the S Corp route since it is noted on here in some posts that some courts are piercing the LLC protections as they are considering it an alter-ego of the person.
My question...is that possible with an S Corp, especially if you are sole owner of the stock? To add a deeper wrinkle in, as a new S Corp with no history of reputation I expect I will have to personally guarantee the S Corp loan.
First how does that work...am I just a co-signer on the S Corp real property loan or is there some other mechanism that comes into play?
Second, does personally guaranteeing the loan on an S Corp change the legality's of your personal asset's being vulnerable for things that happen on the rental property. The question here is not whether you would be liable for the loan (of course you are...you agreed to be to get the loan), but if there is a liability on the property (...like slip and fall) and insurance does not cover it, can you (as an individual shareholder) be sued?
Were is not for the personally guaranteeing of the loan payback...I don't think I would be asking that question, I just wonder if the personal guarantee creates a connection that the slip and fall party can use to sue you personally.