Incorporated vs unincorporated - The Outdoor Community
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post #1 of 6 (permalink) Old 09-05-2012, 11:52 PM Thread Starter
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Incorporated vs unincorporated

What are the advantages or disadvantages of a group of camps buying land together being incorporated or unincorporated
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post #2 of 6 (permalink) Old 09-06-2012, 12:33 AM
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Re: Incorporated vs unincorporated

My opinion only if you need to ask you need an attorney.You have groups involved with possible different interests in mind for the property.If you can't afford an attorney you probably can't afford the property.A group of camps should be able to easily come up with attorney fees to form one combined partnership.In my thoughts you would need one rep from each group with absolute power over decisions.That won't likely happen though.Say your group has a plan a or b.You all vote on a.The rep doesn't like a so he goes to the reps or attorney with plan b.What happens then?You all lose.Just my opinion and possible scenario.Could be all of the guys in all the groups are from Shangra La.

Bob Seger,till it shines.
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post #3 of 6 (permalink) Old 09-06-2012, 12:58 PM
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Re: Incorporated vs unincorporated

Being incoporated can protect the individual members of a camp from sued for a lot of money. The corporation can be sued for its assets but not the members. At least that is my understanding.

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post #4 of 6 (permalink) Old 09-06-2012, 01:23 PM
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Re: Incorporated vs unincorporated

There was at one time, some disadvantages under the tax laws for businesses owning real property. Don't know if they still exist.

John S is right on the money about liability. A partnership or association can be sued to the extent of each individual members' personal assets. It rarely happens though because most folks protect their holdings by getting insurance. Either outright property liability and/or umbrella policies.

Under an incorporation, only the corporate assets can be attached for liability. If an individual stock holder or member has committed the act leading to such liability, that particular person's assets are still at risk in addition to those of the corporation. In order to keep the corporate protection in force, the corporation must follow all the rules and regulations applicable to corporations. Annual filings, stockholder and director meetings, Many of the vacation community associations are set up like corporations and many are actually incorporated. etc. There's many up around Raystown Lake that are run rather slip shod and could result in all the owners in the community being sued as a group and individually. Homeowners insurance will often step in, but it is a mess if some owners don't have it.

For instance, a truck driver delivering pies for a bakery is individually responsible for an accident he causes, the same as his employer, because he is the agent of the company. Now if a member at a camp performs an act for the camp or group of camps and causes an injury while doing so, both he and the camp corporation are liable. If the camp is not a corporation, he and all the members of the camp are liable. That is why having insurance is so important. If the camp maintains adequate insurance, the liability of the members, whether a corporation or not, becomes less likely a problem.
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post #5 of 6 (permalink) Old 09-07-2012, 01:21 AM
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Re: Incorporated vs unincorporated

I incorporated my landscaping business a couple years ago to a s corp. I am the president but could make anyone president but main thing is i own all 100 shares. There is many tax advantages that fit my situation but others can be different. Main thing is i carry a 2 million policy if i screw up sounds good. But, if im pulling my excavator and have the misfortune of hitting a bus i would probably get sues for more than 2 million. If i was a sole propriotor like before or even in a partenership and get sued for 4 million everything my name on personel such as home, property, bank acct., etc could be taken. As an s corp the company would get sued and myself is only an employee of the corp. My home, etc would be safe. The equiptment in the business is owned by me only leased to the corp. so it would be safe too. The corp. is basicly a piece of paper not holding indivuadials liabile. It cost me around 1k to set up.
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post #6 of 6 (permalink) Old 09-07-2012, 01:27 AM
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Re: Incorporated vs unincorporated

Sorry i didnt read your post you pretty well spelledit out. The main thing is carring good ins. but in this days world how much ins. can you carry to have a piece of mind? Other advantages many people in business dont pay them selves the way they should and come up short at tax time. I have myself on weekly payroll just like my staff. In April i get a refund instead of trying to figure out where i will get funds to pay taxs that i didnt keep up with. Yes i do have an annual meeting in my attorneys office that is recquired once a year.
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