The goal of most business owners beyond profit is to protect their businesses and themselves. This is why the government has allowed people the ability to organize or incorporate their businesses. This is how at a basic level you can legally protect the individual and the business.
I met with a prospect that was set-up as a Sole LLC. They run a business in their home and clients are in and out regularly. But when their taxes were filed, it was not as a sole LLC; it was as an individual. Their Schedule C had the owners social security number and the legal name was not listed properly on the name line.
The purpose of Organizing was to protect the individual and home from the business and there was a breakdown leaving all exposed.
I recommended that they contact the person who prepared there return to amend the filing error, to protect themselves and their business.
Since they were a new company, less than a full year in business that as an LLC, I recommended that they consider the S-Corp election option for their LLC. This changes the operational function of the LLC from a Sole LLC which is disregarded entity by the IRS, to an S-Corp for filing and operational purposes. All they needed to do was file an S-Corp election, which they did.
They opted for this recommendation and now the family, home and business will all be protected.