Liability protection is one of the most important reasons for forming any business entity like an LLC or corporation. It's no secret that a lawsuit epidemic is going on in the US and it only seems to be getting worse. Statistics indicate there are more than 1,000 lawsuits being filed every day and small business owners are often prime targets.

One expert said your chances of being sued are higher than your chances of going to the hospital this year? Starting a business only increases the risk.

Small business owners should protect themselves. The most important step you can make to protect yourself is to operate your business activities through a properly formed and maintained entity like an LLC.

One of the main purposes for whicyh LLCs were initially authorized was to provide a shield of protection between the business and its owners. With our lawsuit crazed society, the number of LLCs being formed has grown by over 90% in the past few years. The primary reason is protection.

Small business is an important factor in our national economy. Small businesses provide jobs and income for families. It is a source of financial freedom and independence for many people especially with the downsizing of many larger corporations.

Along with the beneifts, it also brings with added risks.

Intelligent business planning is the best way to reduce the risks. Many new business owners think that lawsuits and personal loss will never happen to them. However, once a lawsuit is filed, its too late to start thinking about forming an LLC.

If you are going to start a business, it is very important that you take the necessary steps to protect yourself as much as possible.

Obviously, you cannot eliminate all possible risks, but you can reduce the potential risk by the formation of the proper business entity and the purchase of liability or business insurance when available. Forming an LLC or corporation should be one of your first priorities.