Yes. An owner may be held personally responsible if he or she: does something purposely illegal or clearly wrong, fails to deposit taxes withheld from employee wages, or personally injures someone.
One exception in particular is extremely important. If the court finds that the members of the LLC acted as individuals, they may declare that the LLC isn’t real. There are steps you and your co-owners can take to avoid this outcome:
- Act legally, be rational. Don’t hide facts or misrepresent your finances to any third party.
- Make sure you have sufficient funding to meet expenditures and possible liabilities.
- Keep the LLC and any personal business completely separate.
- Create and follow an operating agreement.
If you find yourself without limited liability protections for your personal assets, you can look into liability insurance. This insurance can protect some corporate assets and personal assets from claims and liability.