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Comment by Jxl180 | Hacker News Reader

Setting up an LLC to be used as your personal incognito identity is definitely illegal. LLCs are meant to be for operating a legitimate business, not a second personal identity.

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IANAL, but this seems more theoretically correct than practically correct. The truly wealthy have hierarchies of LLCs for the purpose of tax "minimization".

IANAL as well, but I’m sure that is very well the case.

Edit: maybe it’s not illegal, just a bad idea:

https://www.nolo.com/legal-encyclopedia/llc-basics-30163.htm...

If owners don't treat the LLC as a separate business, a court might decide that the LLC doesn't really exist and find that its owners are really doing business as individuals who are personally liable for their acts.

I have no criticisms of Nolo, but "the truly wealthy" hire lawyers. Those professionals are skilled at determining whether to set up partnerships, C-corps, LLCs, whatever. Besides we're talking about anonymity for anonymity's sake (well, also tax minimization and probably lots of other rich people priorities we peons can't imagine), not for dodging creditors. If the principal is poor enough to need to dodge creditors, probably the whole house of paper collapses.

(Probably also the lawyers are the first to know, so they'll get paid up front and be long gone at the time of collapse.)

Definitely consult a lawyer, but it is legal in some circumstances in some states to (for example) anonymously claim lottery winnings or buy real estate. See https://www.natlawreview.com/article/using-llc-or-trust-to-r... for more information.

That would make sense since many businesses invest in real estate and there’s a few states like Delaware that allow anonymous formation of LLCs.

Can you elaborate on this? I think perhaps there's a gap between what the structure is "meant to be for" (meant by who?) and what's legal.

IANAL, but yeah, I’m sure tons of people toe the line or try to use LLCs as their personal piggy bank but I imagine it can come back to bite you if you are taking business tax deductions for personal expenses. I think “influencer” Dan Bilzerian may be in hot water for this (or could be). Every major personal purchase of his is done through his company. https://www.forbes.com/sites/chrisroberts/2020/07/09/dan-bil... > According to the suit, the accountants flagged $843,014.06 in company expenses that appeared to be “personal in nature.” These included payments for charges racked up on one of Dan Bilzerian’s credit cards: a half-million dollar yacht rental; a six-figure, two-night trip to London; a $65,000 “Four Elements Guns & Star Wars Set”; a $50,000 bed fame, a $75,000 paint-ball field, an $88,000 vault, “to name a few.”

Maybe it’s not illegal per-se and maybe just a bad idea:

https://www.nolo.com/legal-encyclopedia/llc-basics-30163.htm...

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