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Originally posted by hickory lane
I checked back with the attorney and told him what the accountant said about "they can still sue you as an officer of the corporation or partner in an llc. It just creates more bookwork and taxes". To my surprise, the lawyer pretty much agreed with him. He said many people form a corporation and then drop their liability insurance coverage thinking they can't be sued. That's a mistake. I'm thinking maybe we are too small at this point to jump to corporate status.
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Our attorney told us for a couple of years prior to our incorporating that if we are incorporating for liability issues, then we could wait until we felt our insurance would not cover completely. If we were going to incorporate for tax purposes, then do it as soon as you can. Our accountant made the first call to tell us that we should do it for the tax benefits.