California corp.

"Robert M. Gary" wrote in message
om...
My graduate law class just covered legal entities. By luck my partner
and I had registered our Mooney in a Mutual Benefit Corp (C-corp).


What is a "Mutual Benefit Corp"? A non-profit? As I remember, you'll
need to file more papers to avoid the minimum franchise tax of $800 (CA),
and will need to continue to pay that fee until your status is approved
(which can take over a year).

Had
we not, the attorney teaching the class said we would probably be
considered "Partners" under the eyes of the law. If we had just put
the plane in our names we would have been "Partners". As near as I can
tell "Partners" is the laws punishment for not doing anything else,
"Partners" happens automatically by default. "Partners" is the worse
case scenario because it comes with unlimited liability.


There are other ways of protecting yourself against liability than forming
a corp. The extra insurance is often cheaper than messing with the
paperwork of maintaining a corp (if you can get a 'flat' policy).

If your
partner is driving to the airport and hits a dog, the dog's owner can
sue you and take your house.

Perhaps the next class will deal with "piercing the corporate veil".
You might not be as enthusiastic about corporate ownership after
that.