Single-member LLC veil piercing protection

by Sergio
(Texas)

I am in the process of filing to form my LLC company. I was going to file for it to be treated as a single-member LLC, but how real is the possibility of veil-piercing? Can this be solved by filing for the LLC to be treated as a Corporation instead?

Answer

I am not aware of any caselaw where a judge has held that the mere fact of being a single member LLC alone was a factor in deciding to pierce the corporate veil.

The method of taxation (corporate vs. partnership), should have no bearing on veil piercing.

Veil piercing is an extraordinary remedy, which will only be used when there is clear indication of fraud by the owner and corporation.

If you're still nervous about veil piercing, The Company Corporation offers a $50,000 Corporate Veil Guarantee with every LLC formation you do through them.

Use the link above and you'll help support this site at no additional cost to yourself (they pay a small commission for every sale that goes through my links).