While limited liability offers significant protections, it is not absolute. Here are some limitations:
Personal Guarantees: Lenders may require personal guarantees from business owners, which can bypass limited liability protection. Fraud and Misconduct: Limited liability does not protect against illegal activities or fraudulent actions by the owners. Piercing the Corporate Veil: Courts can sometimes hold owners personally liable if the business is not operated as a separate entity or if it is used to perpetrate fraud.