All,
A friend told me that I could run into legal issues if I start my own LLC while still being a salaried employee. Has anyone else run into this? I heard that the company could try to claim “rights” to anything you do as a business while in their employ.
Now my friend was approaching it from a retail point of view (forming an LLC to start up a retail shop), rather than an investment point of view (owning property), but he thought I might have problems on the investment side, too.
The company I work for has nothing to do with real estate or investments or anything similar, so there would be no conflict of interest there.
Any insight? Is this likely to be a problem? Is it best to formally request written permission of the company before forming the LLC? How do other salaried employees handle this?
I suspect your friend is referring to intellectual property rights. Often, a company will retain a right of ownership for anything developed by you on company time, or with company resources.
If you are really concerned about this issue, you could ask your company’s legal department if the company’s intellectual property rights would attach to a real estate investment business that you plan to start as a sideline while still employed by the company.
I strongly suspect they will say no and wish you much success.
Dave T is correct. The issue is conflict of interest/breach of contract with your present employer & has nothing to with an LLC or lack thereof. I find it unlikely that your employment prohibits investing in RE, though employers are (rather understandably) not thrilled to hear employees are doing things on the side.