NYCPHP Meetup

[tedd]

At 9:40 AM -0400 10/14/09, -rada- wrote:
>Hi Brian
>
>I have an LLC and have some thoughts for you.
>
>1. For cost reasons, please consider a DBA (doing-business-as) 
>instead of an LLC. It's cheaper (by at least a couple grand) and the 
>piece of paper you get from the City Hall allows you to open a bank 
>account just as well as the LLC formation letter.

A DBA doesn't protect you from anything. It only allows you to do 
simple things like banking. Whereas, incorporation is designed to 
protect you.

>2. Generally, if there is a problem on a contract, you are not 
>liable for more than the contract is worth, unless you are willfully 
>negligent or overstated your professional capabilities AND caused 
>major material damage to the client.

If you think your liabilities are limited to the amount of the 
contract, then you are woefully remise. Your education is lacking 
considerably with respect to liabilities. There are reasons for $1 
million coverages in errors and omissions insurances.

As far as "overstating your professional capabilities" -- I think 
offering advice like that is an example of how right you might think 
you are but how wrong you actually are. There is a difference and 
that can be exploited in court.

>Given that you do web development (as opposed to, say, server admin 
>work) and that your work is incremental (the client signs off on 
>deliverables) I believe your liability issues are not worth the cost 
>of forming an LLC.

Until they are!

Web development carries with it considerable risk. Let's say you do 
something dumb that reduces your client's raking in search engines? 
You don't think your client has a case against you for more in 
damages than what they contracted you for? Think again.

Plus, your client doesn't have to have any proof whatsoever to take 
you to court. To defend yourself can easily run $20k -- been there, 
done that!

Brian -- talk to an attorney and not this list! You won't find much 
worthwhile help here.

Cheers,

tedd

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