LLC to protect personal assets

[scharnhorst]

Hi
I have a friend who does LOCUMS and has formed an LLC to protect personal assets from lawsuits and since he is a single dad also to limit child support payments.He says that since his income fluctuates a lot he pays his kids mom a flat rate every month based on the salary he pays himself from his LLC

also if someone sues him it will protect his personal assets retirement /savings account etc

Is that legal and /or possible ?

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[septoplasty]

In our line of business, no the LLC doesn't necessarily protect against anything (further specific reading "PLLC").

Basically locums companies will hire you as a contractor, therefore they don't need to deal with the mess of providing benefits, extra accounting etc. Thus you form your own "PLLC/LLC" (depending on state), and the locums company pays your "company". You essential file taxes as company.

Now, if you get litigated, the LLC/PLLC DOES NOT protect you from the judgement. Unless your state has tort reform (which technically has nothing to do with LLC).

 

[VA Hopeful Dr]

In our line of business, no the LLC doesn't necessarily protect against anything (further specific reading "PLLC").

Basically locums companies will hire you as a contractor, therefore they don't need to deal with the mess of providing benefits, extra accounting etc. Thus you form your own "PLLC/LLC" (depending on state), and the locums company pays your "company". You essential file taxes as company.

Now, if you get litigated, the LLC/PLLC DOES NOT protect you from the judgement. Unless your state has tort reform (which technically has nothing to do with LLC).

Bingo.

If forming an LLC (or PLCC) worked that way, everyone would do it. Or at least enough people that it would be a thing.

That said, there can be benefits to being paid as an LLC (mainly access to some types of retirement plans).