my dad put his business in my name. what are the risks of having a business in my name? i am a constant?

Question

worrier and won't stop worrying until i hear the worst of things.

Answer 1

If you are a constant worrier, should have no business running a business.

Answer 2

He can embezzle the company dry and leave you with the dirty end of the stick (and the tax debt) as he spend the rest of his life on a beach somewhere.

You could sell the company out from under him.

You are the owner of record...good or bad, if something happens, it lands in your lap. There are good and bad reasons, legitimate and non-legitimate reasons.

Tell your father that you will be retaining a lawyer and an accountant to protect your interests, and paying them out of the profits of the company.
Sound like a sure-fire way to make Family dinners awkward? It is. Try talking to Mom (assuming your parents are still married and on good terms), and see if she will buy it from you.

Alternatively, if your dad's business interests you, jump-in with both feet, and help run it. Start building a client base of your own. Sit down with the old man and discuss *why* he put it in your name, and pay him a reasonable salary.

Now, if you are a minor...it was doen for tax reasons, and should dad's business interest you, you can walk right into it when you "grow-up," and have dad start a new one!

Answer 3

Depends on the type of business.

Sole Propietorships and Partnerships mean that you are at risk and personally liable for debts of the company (i.e. if someone sues the company, you are responsible for the excess loss not coverable by the company if you lose the suit)

Limited Liability Companies (LLC) and Corporations legally mean that the business is its own entity and you will not be responsible for the debts of the company. If the company goes under and still owes money, you aren't accountable for it. However, this broad rule has the exception of you still being liable in the case that the wrong was malicious (done with ill-intent).

My thought is that you are probably under the first one, but it only takes the filling out of a few forms to incorporate. LLC is best if they offer that form of business in your state.

[by the way, these rules apply to US companies, I'm not sure of international]