Q: Considering an LLC for my Kickstarter: Should I create one before funding? Is it worth the precaution?
I am not sure if it is worth the cost of forming an LLC to have the protection in legal trouble. I do not currently and any real assets in my name, but am concerned about failing to deliver and being set with debt. Is there some better way of avoiding this?
A: Forming an LLC for your Kickstarter project can provide benefits and protections. Creating an LLC before seeking funding can help separate personal assets from business activities, potentially protecting personal finances in case of legal trouble or debt. While there are costs and administrative requirements involved, it may be worth considering as a precautionary measure. However, consulting with a business attorney or professional is important to assess your specific situation and receive personalized advice. Additionally, maintaining transparency, delivering on promises, and managing the project responsibly are crucial steps in avoiding legal trouble and debt. Planning carefully, setting realistic goals, and communicating effectively with backers can help minimize risks.
Timothy Denison and Martha Warriner Jarrett agree with this answer
A: In the event that your business ultimately fails, bankruptcy is always an option, but it's an expensive option and the results aren't guaranteed. It would be much better to set it up as an LLC to start with and the previous advice to consult a business lawyer first is good advice.
Timothy Denison agrees with this answer
A:
A properly formed, funded and maintained LLC can protect members' personal assets. Failing to do all three offers very little to safeguard anything. Merely filing the initial paperwork and getting identification numbers does little more than provide creditors with a slight inconvenience.
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Timothy Denison agrees with this answer
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