Any lawsuits against your shop?

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Basically I'm trying to decide if I should incorporate my small business or not. I run a small welding and fabrication shop to pay for college. I'm not sure if this is something I want to do as a business for the rest of my life or if it will just end up being a hobby. Right now I'm just a sole proprietor. I have insurance that covers 1,000,000/2,000,000. I haven't been concerned about it till a couple people mentioned it to me that any lawsuit over my insurance limit, the balance will take my house, and everything I own. I've got a pretty good understanding of the differences between incorporating or keeping it as a sole proprietor, I'm just curious how many lawsuits (if any) have actually been filed against your shops?John 3:16(2) Miller Pheonix 456(2) Millermertic 252Dynasty 210DXHobart 210MVPDoringer D350 SA Cold SawScotchman 350LT Cold SawWebb 10x50 MillWebb 15x40 LatheGeka Bendicrop Ironworker
Reply:What about doing an LLC?Torchmate 2x2 CNC with Flashcut CNC controlsHypertherm Powermax45 Esab ET220i Razorweld 195 MigRazorweld 200ac/dc TigTormach 770, Tormach xstechRazorweld, Vipercut/Vipermig, SSC Foot Pedal Dealer
Reply:All it takes is one...you could live your entire life without a lawsuit or get one tomorrow. Better off protecting yourself somehow.
Reply:LLC will not protect you like you think. They'll sue YOU and the LLC You have insurance so you are already on the right track- find a good lawyer in your town and discuss the options with him if you want to form an LLC for your business.Ed Conleyhttp://www.screamingbroccoli.com/MM252MM211 (Sold)Passport Plus & Spool gunLincoln SP135 Plus- (Gone to a good home)Klutch 120v Plasma cutterSO 2020 benderBeer in the fridge
Reply:How much does it cost to incorporate?  A single lawsuit could cost you everything, not just your shop but your home if you don't incorporate.  If you are making gates, don't worry about it but if you are welding pressure vessels or working on truck frames it is certainly something to consider.  It goes beyond personal injury claims too.  If you fabricate a structural component for a building or bridge and for some silly reason it does not meet the requirements they may come after you for time lost.Last edited by 76GMC1500; 12-06-2013 at 02:37 AM.
Reply:You can get incorporated fairly inexpensively, look around and make a few calls, I went to school with kids who had their own corps just because it insolated them from the company somewhat.
Reply:When I was a contractor before I semi retired, My accountant advised me to incorporate. I did and it has advantages and disadvantages. One is that your corporation gets sued and not personally however if your business is worth more than your home and personal belongings you loose. Tax wise it is more money because of business and personal with the accountant fee. Here in Florida a corporate report has to be sent to the state every year, more expense. My opinion is you never know that one time could leave you pennyless. Just about three years ago my wife pulled out in front of a driver (it was her fault) however we were sued for $100,000.00 and that was the maximum my insurance would pay. If they sued for more damages I would be giving the keys to my home to them, court outcome of course. My advise (67 year old man ) do everything in life the right way and you can sleep at night. sincerly zarpman66
Reply:Take a look at LegalZoom.com. They charge a $99 process fee for an S corp. There are different filing fees for each State. Personally I would wait until you have a couple of permanent full time employees, as the monthly bookkeeping expenses skyrocket when you incorporate. And dis-incorporating is nearly impossible without dissolving the company. Be careful you trust.Weld like a "WELDOR", not a wel-"DERR" MillerDynasty700DX,Dynasty350DX4ea,Dynasty200DX,Li  ncolnSW200-2ea.,MillerMatic350P,MillerMatic200w/spoolgun,MKCobraMig260,Lincoln SP-170T,PlasmaCam/Hypertherm1250,HFProTig2ea,MigMax1ea.
Reply:Cash only, fly by night welding...........Taillight warranty...Disclaimer; "I am just an a$$hole welder, don't take it personally ."
Reply:Originally Posted by TozziWeldingCash only, fly by night welding...........Taillight warranty...
Reply:Originally Posted by shovelonTake a look at LegalZoom.com. They charge a $99 process fee for an S corp. There are different filing fees for each State. Personally I would wait until you have a couple of permanent full time employees, as the monthly bookkeeping expenses skyrocket when you incorporate. And dis-incorporating is nearly impossible without dissolving the company. Be careful you trust.
Reply:I'm sorry, under advise of my lawyer, I cannot answer your question.
Reply:I know of one operation now paying more for insurance than their rent, though granted, they've racked up quite the tally of claims over the years wrecking cars while out on test rides.Another shop I know has said quite plainly to everyone that works there that after just one claim, whether it be a work related accident or otherwise and they are out of business.  Then, many business owners falsely believe that if they hire everyone as a contractor that they are absolved of any work related injuries but the law in many states makes it quite clear what a contractor is whether you call someone one or not.  I'm sure at least one business owner who also was advised to use their business as a tax shelter for their expensive toys have lost their boat, motorcycle and RV when one of their 'contractors' left their fingers behind at work.  Same with those who trust their 'friends' not to sue them.I've heard many instances of companies that operate without insurance and are prepared to simply fold when they can't afford to absorb a lawsuit or any judgment against them.  Here though you still need to budget a sizable sum to lawyers and accountants so that any plaintiffs and their legal representatives can't 'pierce the corporate veil' as they say.  As many small corporations and LLCs are merely window dressing in the false belief that they will protect the owners personal assets should something happen.    One pattern I have noticed is that poor people without assets tend not to get sued.  That's why some states have uninsured driver coverage options.  If a drunk hobo gets hit by a car jaywalking he'll have personal injury firms lining up to represent him for a percentage against the driver, if the same hobo throws a rock through your windshield and causes an accident, unless you want to pay up front all their legal fees (and even then, most won't accept the case because there's no payoff) good luck finding representation and if the accident cause by the thrown rock resulted in a third party being injured, they'll be going after you!I've been noticing a lot of talk here on the subject, it's always one of those things I wonder about but don't want to ask.
Reply:my employer is self insured and is being sued constantly. a quick somewhat unrelated story. many years ago a co-worker was driving me from the job to the subway. enroute a gypsy cab ran a stop sign and we were in an accident. i went to the er strapped to a board but was ok just sore ribs and a few missed days from work. on my return quite a few people advised me to sue my friends ins co as it wasn't his money. made me wonder what kind of people i was working around to say the least.Last edited by docwelder; 12-17-2013 at 05:02 AM.i.u.o.e. # 15queens, ny and sunny fla
Reply:If you don't want the high expense of insurance, it's lot easier accepting jobs with without the high liability risk. Sadly to say, lawyers have a way of squeezing blood out of a turnip. Good thread.Miller Bobcat 250Syncrowave  200Millermatic 252Spoolmatic 30ASpectrum 625 X-TremeMaxstar 150SVictor O/A torchesDewalt angle grindersWelded on/off for over 40 years.
Reply:One pattern I have noticed is that poor people without assets tend not to get sued