X-Virus-Scanned: clean according to Sophos on Logan.com Return-Path: Sender: To: lml@lancaironline.net Date: Sun, 01 Sep 2013 20:31:59 -0400 Message-ID: X-Original-Return-Path: Received: from col0-omc3-s1.col0.hotmail.com ([65.55.34.139] verified) by logan.com (CommuniGate Pro SMTP 6.0.6) with ESMTP id 6449799 for lml@lancaironline.net; Sat, 31 Aug 2013 22:39:52 -0400 Received-SPF: pass receiver=logan.com; client-ip=65.55.34.139; envelope-from=peterpawaviation@hotmail.com Received: from COL129-W6 ([65.55.34.137]) by col0-omc3-s1.col0.hotmail.com with Microsoft SMTPSVC(6.0.3790.4675); Sat, 31 Aug 2013 19:39:19 -0700 X-TMN: [iRwkrWPpGibKemTzuc1mtgJaqmIaM8JG] X-Originating-Email: [peterpawaviation@hotmail.com] X-Original-Message-ID: X-Original-Return-Path: peterpawaviation@hotmail.com Content-Type: multipart/alternative; boundary="_2c09b7f2-e776-4835-8308-9d40159c832d_" From: PETER WILLIAMS X-Original-To: Subject: RE: [LML] LLC for Insurance - Caution X-Original-Date: Sat, 31 Aug 2013 22:39:19 -0400 Importance: Normal In-Reply-To: References: MIME-Version: 1.0 X-OriginalArrivalTime: 01 Sep 2013 02:39:19.0772 (UTC) FILETIME=[759EB1C0:01CEA6BC] --_2c09b7f2-e776-4835-8308-9d40159c832d_ Content-Type: text/plain; charset="Windows-1252" Content-Transfer-Encoding: quoted-printable Hi there I think that it has been firmly established that a corporation is separate = entity. (See recent Supreme Court decisions) There are several cautions=20 1. If you have a corporate bank account=2C ONLY use it for the aircraft N= EVER buy a gift for your wife from that account=20 2. Have annual meetings. Which is a book keeping entry once a year 3. File yearly tax returns and pay franchise taxes This is as true for your business corp as it is for your Nevada corp Personally I keep corporations for business trucks=2C real estate owned=2C = even the cars i drive=2C and business entities. ONLY IF YOU WANT TO PLAY WITH IRS DEDUCTIONS I wouldn't try to deduct aircraft cost from personal taxes unless you have = more than one airplane or unless you carefully document your use versus you= r personal use. THEN=2C to be safe pay a fair rent to the corporation=20 All of this can save you a lot of money If you lend your corporate plane to a friend and he crashes it into a meeti= ng of the billionaires club=2C your personal assets are protected. Peter To: lml@lancaironline.net Date: Sat=2C 31 Aug 2013 18:15:08 -0400 From: mpgarr01@hotmail.com Subject: [LML] LLC for Insurance - Caution As I understand it=2C you & your partner want to insure a Lancair turbine a= ircraft located in CA. The only available insurer has determined not to do= business in that state. You propose forming an LLC in NV (presumably maki= ng the A/C an asset of that LLC=2C at least on paper) in order to get the d= esired coverage from the company. Presumably the A/C is in CA and you inte= nd to base it there or the insurer would not be balking about doing busines= s in that state. It's certainly possible the company will ultimately accept your premiums an= d issue coverage to a newly formed NV entity. As a retired/reformed lawyer= =2C however=2C I have concerns about your proposal. Unless you are truly d= oing business in NV and have substantial business contacts with that state = there's a real risk that plaintiff's counsel will attempt to "pierce the co= rporate veil" in the event of a mishap in CA or any other state apart from = NV. Piercing the corporate veil involves holding the owners of an LLC (you and = your partner) liable for the debts of the company (damages in a mishap). = =0A= Generally=2C piercing the corporate veil can only be done in extreme =0A= situations such as when the shareholder commits fraud or when the =0A= corporation is deemed the =93alter ego=94 of the shareholder. The standar= d =0A= for successfully piercing the corporate veil in NV may be stricter =0A= than in your home state. However=2C it is important to note that if litig= ation takes place in your home state or in some other state besides =0A= NV=2C conflicts of laws principles may cause the law of a state other =0A= than NV to control whether a piercing the corporate veil action =0A= would be successful. In other words=2C judges often have a lot of =0A= discretion as to which state=92s laws apply in multi-state cases and often= =0A= begin with the assumption that the law of the forum applies unless a =0A= party can show that another state=92s laws have greater contacts or =0A= interests in the case. =20 In fact=2C while NV corporations are often =0A= promoted as being particularly useful to business owners in CA=2C =0A= CA has been one of the most aggressive states in applying its =0A= own corporate laws to businesses incorporated elsewhere but doing =0A= business in CA. The more serious the mishap=2C the greater the scrutiny you= r "corp." is going to be subject to. Recommend you consult CA counsel with a background in aviation law before l= eaping on this idea. Cheers=2C Mark (Notre Dame=2C JD=2C 1984) =20 = --_2c09b7f2-e776-4835-8308-9d40159c832d_ Content-Type: text/html; charset="Windows-1252" Content-Transfer-Encoding: quoted-printable
Hi there

I think that it = has been firmly established that a corporation is separate entity.
 = =3B =3B =3B =3B =3B =3B (See recent Supreme Court decis= ions)

There are several cautions
1. =3B =3B If you have = a corporate bank account=2C ONLY use it for the aircraft NEVER buy a gift f= or your wife from that account
2. =3B =3B Have annual meetings.= Which is a book keeping entry once a year
3. =3B =3BFile yearly= tax returns and pay franchise taxes

This is as true for your busine= ss corp as it is for your Nevada corp

Personally I keep corporations= for business trucks=2C real estate owned=2C even the cars i drive=2C and b= usiness entities.

ONLY IF YOU WANT TO PLAY WITH IRS DEDUCTIONS
I = wouldn'=3Bt try to deduct aircraft cost from personal taxes unless you h= ave more than one airplane or unless you carefully document your use versus= your personal use. THEN=2C to be safe pay a fair rent to the corporation <= br>
All of this can save you a lot of money

If you lend your corp= orate plane to a friend and he crashes it into a meeting of the billionaire= s club=2C your personal assets are protected.

Peter


T= o:=3B lml@lancaironline.net
Date:=3B Sat=2C 31 Aug 2013 18:=3B1= 5:=3B08 -0400
From:=3B mpgarr01@hotmail.com
Subject:=3B [LML= ] LLC for Insurance - Caution

As I understand it=2C you &=3B your partner want to insur= e a Lancair turbine aircraft located in CA. =3B The only available insu= rer has determined not to do business in that state. =3B You propose fo= rming an LLC in NV (presumably making the A/C an asset of that LLC=2C at le= ast on paper) in order to get the desired coverage from the company. = =3B Presumably the A/C is in CA and you intend to base it there or the insu= rer would not be balking about doing business in that state.

It's ce= rtainly possible the company will ultimately accept your premiums and issue= coverage to a newly formed NV entity. =3B As a retired/reformed lawyer= =2C however=2C I have concerns about your proposal. =3B Unless you are = truly doing business in NV and have substantial business contacts with that= state there's a real risk that plaintiff's counsel will attempt to "= =3Bpierce the corporate veil"=3B in the event of a mishap in CA or any = other state apart from NV.

Piercing the corporate veil involves hold= ing the owners of an LLC (you and your partner) liable for the debts of the= company (damages in a mishap). =3B =0A= Generally=2C piercing the corporate veil can only be done in extreme =0A= situations such as when the shareholder commits fraud or when the =0A= corporation is deemed the =93alter ego=94 of the shareholder.  =3B The = standard =0A= for successfully piercing the corporate veil in NV may be stricter =0A= than in your home state. =3B However=2C it is important to note that i= f litigation takes place in your home state or in some other state besides = =0A= NV=2C conflicts of laws principles may cause the law of a state other =0A= than NV to control whether a piercing the corporate veil action =0A= would be successful. =3B In other words=2C judges often have a lot of = =0A= discretion as to which state=92s laws apply in multi-state cases and often= =0A= begin with the assumption that the law of the forum applies unless a =0A= party can show that another state=92s laws have greater contacts or =0A= interests in the case.  =3B

In fact=2C while NV corporations ar= e often =0A= promoted as being particularly useful to business owners in CA=2C =0A= CA has been one of the most aggressive states in applying its =0A= own corporate laws to businesses incorporated elsewhere but doing =0A= business in CA. The more serious the mishap=2C the greater the scrutiny you= r "=3Bcorp."=3B is going to be subject to.

Recommend you con= sult CA counsel with a background in aviation law before leaping on this id= ea.

Cheers=2C Mark (Notre Dame=2C JD=2C 1984)
= --_2c09b7f2-e776-4835-8308-9d40159c832d_--