09/30/2025
Re-posted From Andrew Ayers, P.C. LinkedIn post
This is why consulting an attorney before creating a business is crucial. Here is Mr. Ayers' story:
3 years ago, my client started an LLC in 20 minutes online. Last week, it cost him $75,000.
He followed all the steps. Filed with the state. Got his EIN. Even bought the fancy corporate seal from that marketing company that convinced him it was necessary.
What he didn’t do? The first 4 steps that actually matter. (And yes, the state will take your filing fee without telling you what you’re missing.)
When his customer sued, the opposing attorney went straight for personal assets. “Your LLC doesn’t exist, “ they said. Technically, it did. The state had the paperwork. Practically? They were right. No operating agreement. No separate bank account. No meeting minutes. No corporate formalities.
His LLC was a $155 piece of paper (**Note - this is in Minnesota). Nothing more. The judge agreed. Pierced the corporate veil in under 10 minutes.
The First 4 Steps That Actually Protect You:
Step 1: Separate Everything
Business bank account. Business credit card. Business expenses. Mix personal and business even once? You’ve created evidence against yourself.
Step 2: Operating Agreement (Even if you’re solo)
“But I’m the only owner!” doesn’t matter. This document proves your LLC is real. Without it, you’re just playing business.
Step 3: Document Your Meetings
Annual meeting minutes. Major decisions in writing. Sounds silly for a one-person LLC? Tell that to the judge who’s deciding if you’re legitimate. (**Note - annual meetings are not required under Missouri's LLC statute)
Step 4: Maintain Corporate Formalities
Sign contracts as “John Doe, Manager of XYZ, LLC.” Not just “John Doe.” Use your LLC name on everything. Invoice from the LLC. Get paid to the LLC.
These aren’t suggestions. They’re the difference between protection and personal bankruptcy.
My client thought forming an LLC was like buying insurance. Pay the fee, get protected. But an LLC is more like a bulletproof vest. It only works if you wear it correctly. Every. Single. Day.
Starting an LLC online is easy. The state makes it simple on purpose. Maintaining one that actually protects you? That’s where 90% of business owners fail. They get the birth certificate but skip raising the child and then wonder why it can’t protect them when they need it most.
**We highly advise you to consult an attorney when starting a business.
