Home Based Incorporated Business - is home a business asset?

[deedee_77]

What is the name of your state (only U.S. law)? Virginia

My husband's cousin started an HVAC company that is incorporated. The business address is the same as his home address, but the house is in his name and not in the businesses name. He signed a contract to do some work for a particular project without completely understanding how much it would cost and now that he's loosing money on the job he wants to "walk off" before he looses any more money. He is now concerned that if he breaks the contract that his home could be seized (or a lien could be put on the home) by the company that he made the contract with. Is this possible? If it's incorporated then personal & business assets should be separated, but the fact that the businesses address is his home address has got him concerned. I know that he will need to consult a lawyer should he actually decide to "walk off" the job, but I wanted to see if I could help him get a little more understanding of the situation before he makes a final decision. Any information would be appreciated.

Thanks.

 

[tranquility]

The mere fact he uses his home's address as a business asset will not put the home at risk. The fact it seems the corporation may be undercapitalized, might.

Incorporation is not a magic bean to avoid responsibility. It helps, and certainly makes collection of other assets harder, but I would be sure to see an attorney before any choices are made.

I'd look at possibly losing any professional licenses too--if the amounts are large enough.

 

[Ohiogal]

Piercing the corporate veil is very possible so that personal assets could be taken.