Can an LLC's name have my initials?

[cme8888]

Jurisdiction

Texas

I was thinking of starting an LLC to sell products. I have heard that an LLC's owner can't be too personally linked to the LLC, or he could lose the lawsuit immunity that the LLC gives him. I have some questions.

1. Is it okay for the LLC's name to contain my initials (something like MEC Wholesale), or would that make me too personally linked to the LLC?

2. Even if it is relatively safe for the LLC's name to contain my initials, would it be even safer to not use my initials, or should using my initials not matter?

Thanks

 

[army judge]

1. Is it okay for the LLC's name to contain my initials (something like MEC Wholesale), or would that make me too personally linked to the LLC?

2. Even if it is relatively safe for the LLC's name to contain my initials, would it be even safer to not use my initials, or should using my initials not matter?

You allege you are concerned about potential liability and want to play it safe.

Yet, you're seeking FREE advice from anonymous people via the internet about the formation of your BUSINESS.

If you care as much as you say you do, hire yourself a lawyer and create your LLC the right way.

I'm a lawyer, yet when I decided to create a PLLC, an LLC, an INC, and a CO; I retained the PAID services of a licensed law firm.

I could have done it myself, but it was worth paying to have it done well.

I also hire professional painters, landscapers, handymen, and other professionals to do things I could do myself, but others do better.

 

[flyingron]

The name is the least of your concerns in linking. In practice, a single member LLC doesn't provide much of a liability shield at all because you are always responsible for your own actions. It may or may not provide financial protections.

Obscuring the connection between you and the LLC is NOT going to provide protection.

 

[adjusterjack]

Nor will it prevent you from being personally sued. Even if you are ultimately absolved of liability you still would have spent many thousands on litigation costs to get there.

While an LLC is helpful to some extent, the safe bet is to buy the proper insurance on the business and its products.

 

[zddoodah]

I have heard that an LLC's owner can't be too personally linked to the LLC, or he could lose the lawsuit immunity that the LLC gives him.

Where did you "hear" that? That's just silly, and that makes your questions moot.

 

[Tax Counsel]

I was thinking of starting an LLC to sell products. I have heard that an LLC's owner can't be too personally linked to the LLC, or he could lose the lawsuit immunity that the LLC gives him. I have some questions.

1. Is it okay for the LLC's name to contain my initials (something like MEC Wholesale), or would that make me too personally linked to the LLC?

2. Even if it is relatively safe for the LLC's name to contain my initials, would it be even safer to not use my initials, or should using my initials not matter?

Thanks

Putting your name on the business is not what opens the door to personal liability for the debts of the business. Henry Ford put his last name on his car company, Milton Hershey put his last name on his chocolate corporation, Jimmy John Liautaud put his first and middle names on his sandwich chain, Ben Cohen and Jerry Greenfield put their first names on their ice cream company. I could go on, but you get the idea. The name is not the issue. What gets you into trouble is being too loose with how you run the company. To avoid that problem, see a business lawyer in your state who can tell you what you need to do to ensure you don't run into a problem with people seeking personal liability against you for the debts of the business based on a theory of piercing the corporate veil or alter ego.

Whether putting your name or initials on the company versus some other unique name would be best for marketing purposes is another matter.

 

[Tax Counsel]

Where did you "hear" that? That's just silly, and that makes your questions moot.

He didn't phrase it particularly well, but what I think he is getting at is the problem of personal liability for the LLC debts because the LLC is not operated in way that respects the separate existence of the LLC entity. Doing things like treating the LLC assets much like they were his own assets, failing to properly capitalize the business, failing to observe the formalities that the LLC must follow, etc, are what lead to that problem. Doing those kinds of things makes it look like the business is more of a sole proprietorship than a separate business entity, and sets up LLC creditors going after the owners under a theory of piercing the corporate veil or alter ego.

 

[Nada Alnajafi]

I was thinking of starting an LLC to sell products. I have heard that an LLC's owner can't be too personally linked to the LLC, or he could lose the lawsuit immunity that the LLC gives him. I have some questions.

1. Is it okay for the LLC's name to contain my initials (something like MEC Wholesale), or would that make me too personally linked to the LLC?

2. Even if it is relatively safe for the LLC's name to contain my initials, would it be even safer to not use my initials, or should using my initials not matter?

Thanks

Yes, the name of the LLC can contain your initials. I believe what you heard was that an owner's personal finances should not be linked to the LLC's finances or you can risk being held personally liable for things that your LLC were meant to protect you for. For example, if the LLC makes $10,000 and you use the LLC's credit card to purchase new shoes for your wife, then there is arguably no difference between you (personally) and the LLC, and you will have effectively "pierced the corporate viel."