The LLC Mistakes That Kill Protection

Forming an LLC feels like a shield — but if you treat it like a side hustle formality, that shield can shatter the first time it’s tested. Courts look past the letters if your setup isn’t tight.

The top mistakes I see:

1. Mixing Funds
   Swipe the LLC card for personal gas and groceries? That’s called “piercing the veil.”
   
   

2. No Operating Agreement
   Even single-member LLCs need one. Without it, courts assume the worst.
   
   

3. Ignoring Annual Filings
   Miss a report, lose your good standing. No standing, no shield.
   
   

4. Using the Wrong Tax Election
   Your LLC’s tax status impacts everything — from payroll to deductions.
   
   

5. No Record Keeping
   If you can’t show records, the LLC is just a name on paper.
   
   

The Fix?
Respect the structure you built. Keep it separate, compliant, and documented. Then your LLC does what it was meant to do — protect you.

📘 Need a compliance checkup? [Book an LLC review.]