If I Start an LLC with a Partner Who Owes Child Support or Back Taxes, Can the Government Take Money from the Business?

Much of the ability of a government agency to easily seize or attach assets for issues like unpaid child support or unpaid taxes rests with the type of business structure created.

In a General Partnership situation, the partnership typically relies on personal-based bank accounts and the personal social security numbers of the partners to transact business. In such a situation, it is easy for a government agency to track specific persons who use their own names and personal IDs.

Typically, the bank account that is created for a state-registered business is done so in the name of the LLC or new corporation, not in the personal name of any of the members (owners) of the Limited Liability Company or Incorporation. The bank account is also typically created using a business Tax ID number, not with a personal social security number. (But the registration documents for the LLC or Incorporation do typically contain personally identifying information of the members or shareholders.)

(This type of information — along with all of the documents necessary to file and manage an LLC — are provided within Standard Legal’s Limited Liability Company legal forms software and Incorporation legal forms software.)

Past that, no person can state with 100% certainty what legal actions a government agency might take to obtain the money due to it.
If a person wants legal advice to better protect himself or a new business, Standard Legal suggests discussing the situation with a local attorney. To find a local attorney for FREE, visit Standard Legal’s Attorney Finder page.