If I have commingled my personal and LLC accounts and know that this compromises the corporate veil, how can I correct this?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
If I have commingled my personal and LLC accounts and know that this compromises the corporate veil, how can I correct this?
I will have separate accounts in the future, but the transactions showing the commingled actions will always be there in my bookkeeping system. Will I ever be free of the potential piercing the corporate veil anytime in the future?
Asked on July 7, 2014 under Business Law, Nebraska
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 10 years ago | Contributor
To best insulate yourself from the threat of a creditor, etc. piercing the corporate veil, make sure you have thoroughly documented which money was yours and which was the company's; make sure you did not claim any tax benefit(s) to which you were not entitled; and to the extent that you used any company money for your personal expenses, repay it, and document the repaying. You want to be in a position to show you may have made bookkeeping errors at one point by comingling, but that you have not actually taken any company money for your own, in that anything you inadvertantly took, you repaid; also that even if you mistakenly kept all the funds in the same account(s), you can track accurately whose funds are whose and the source of all funds.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.