startup-costs, incorporation, delawareI have recently incorporated a Delaware Corporation. I’m a single founder and planning to bring partners and investors after 6 months.
At this moment i’m using my personal credit card for company expenses.
I know I should not use a company credit card for personal expenses. But i’m doing the exact opposite.
Does that mean i’m piercing my corporate veil?
The simple solution would be to create a repayment agreement between yourself and your corporation for any personal money you spend on behalf of the corporation.
What you’re doing wouldn’t be “piercing the corporate veil”, because there’s nothing in the law precluding this. You pierce the veil when you fail to observe the organizational or record-keeping record-keeping requirements for a corporate entity, depending on the state you formed it in. It could also be piercing the corporate veil if you treat the company’s money as if it’s yours for personal expenses, almost like a personal “piggy bank”, but there is no rule of which I’m aware that says you are not allowed to pay corporate expenses with personal funds.
The best practice would be to draft an agreement to be repaid by the company for anything you personally spend, which will keep everything clean for your investors when you’re ready to bring them in.
I hope this helps.
Good luck!
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