Illinois Inc.'s negative verbiage.

[slacker]

I’m currently making some incorporation changes here in Illinois. My request came back from the State saying that I need to add some negative verbiage stating that “Blah Blah Inc. will not render the services of a State Licensed, State Certified, or State Certified General Appraiser”. I’m confused? Anyone from the “Land of Lincoln” had any experience with this?

 

[Ruth Langkawel]

I'm by no means a legal authority, but I believe they are requiring this because the corporation is a seperate entity from the individual that may own all of it's stock. Small corporations are typically a guise to shelter a business person from liability, or from taking personal losses due to suits against their business activity. Appraisers are not allowed to shelter their personal assets from suits for professional misdeeds.

You may want to ask your attorney if it would be more prudent to incorporate your property rental business - and have your appraisal corporation rent office space, equipment, car, residence for CEO as part of the benefit package, etc, etc, from the rental corporation.

Properly orchestrated, incorporating can be an excellent tax saver. Improperly orchestrated, it can expose you to double taxation, and not limit you liability losses in the least. This is not a do-it-yourself job. It IS a job for a dedicated and experienced professional attorney, specializing in corporate and tax laws.

Good luck. Pass on any pearls of wisdom that you find in your research.
8)

 

[Richard Carlsen]

I think Ruth hit it on the head. You are licensed as an individual to do appraisals but the corporation cannot do appraisals, as it is not licensed. What they are saying is that in the incorporation docs you will agree that the corporation name will not go on an appraisal as the appraiser.

Think of it this way, you cannot hang a corporation from a white oak tree. An appraiser is a different matter.

 

[Bryan (OK)]

Appraisers are not allowed to shelter their personal assets from suits for professional misdeeds.

Ruth,

Are appraisers any different from doctors, attorneys, electricians, etc.? I am not a legal expert, but I have always understood that corporations were a liability shelter. If what you say is true, there is no way for an appraiser to protect his or her assets except for a mile high limit on E&O insurance.

Wondering,

Bryan

 

[slacker]

You may want to ask your attorney if it would be more prudent to incorporate your property rental business - and have your appraisal corporation rent office space, equipment, car, residence for CEO as part of the benefit package, etc, etc, from the rental corporation.

Ruth,

You were correct with the separation of the Corporation and the individual. I heard back from the state and they indicated that they do not license corporations or companies to perform appraisals.

And your other suggestion about the rental biz was brought up by my attorney but he also warned that these are big audit red flags as well.

I looked around my neighborhood this weekend and didn’t find any White Oak Tree’s. So at least I’ve got that going for me.