More Ways in the Maze

BY NANDA SENATHI

I very much enjoyed reading the article, “The Choice-of-Entity Maze ” (March 07, page 64). Perhaps we should also consider the difference between the liability protection of a corporation and that of an LLC from lawsuits or other claims directed against owners of these entities.

A corporation generally protects shareholders from lawsuits directed against the corporation; it does not necessarily protect corporate assets from lawsuits directed against the shareholders. On the other hand, in many states, the exclusive remedy available to a creditor against an LLC membership interest involves collecting monies from a debtor-member, without disrupting the LLC business or other solvent members.

Nanda Senathi, CPA, CMA
Hermosa Beach, Calif.

Author’s reply: The letter’s author raises a good point. However, I do not think as accountants we should, or even can, expand the discussion on liability protection other than to recommend that clients consult with an attorney to properly address the nuances of the liability protection offered by a corporation versus an LLC .

Gregory A. Porcaro, CPA
Warwick, R.I.

SPONSORED REPORT

How to make the most of a negotiation

Negotiators are made, not born. In this sponsored report, we cover strategies and tactics to help you head into 2017 ready to take on business deals, salary discussions and more.

VIDEO

Will the Affordable Care Act be repealed?

The results of the 2016 presidential election are likely to have a big impact on federal tax policy in the coming years. Eddie Adkins, CPA, a partner in the Washington National Tax Office at Grant Thornton, discusses what parts of the ACA might survive the repeal of most of the law.

QUIZ

News quiz: Scam email plagues tax professionals—again

Even as the IRS reported on success in reducing tax return identity theft in the 2016 season, the Service also warned tax professionals about yet another email phishing scam. See how much you know about recent news with this short quiz.