Legal Question in Business Law in Alabama
Piercing the corporate Veil
I have recently formed an LLC with two other partners. I am concerned about ''Piercing the corporate Veil'' of the newly formed LLC. What steps should I take to avoid being personally liable for acts of the LLC.
How do I handle purchases that have been made with personal credit cards, but were used for company purposes.
Thanks for any information that you can give me on this matter.
Matt D
1 Answer from Attorneys
Re: Piercing the corporate Veil
The simple answer is to maintain the corporate "formalities." Basically, treat the business like a business and piercing the corporate veil is less likely.
A few examples would be to keep updated minutes of any business meetings, do not mingle business and personal assets, maintain an updpated Operating Agreement, etc.
As for the expenses, you can reimburse from the business account and you may want to indicate a reimbursement plan in the Operating Agreement.
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