Incorporating a business is not difficult it can be done online or physically. Anyone who has a business can incorporate his business irrespective of size. There are many types of corporations available in the US so before you incorporate your business learn about the different kinds of business structures available in the US. You must also find out what the advantages and disadvantages of incorporating business in different states are. Incorporation of a business can be handled by a qualified lawyer or professional incorporating services. The main document that has to be filed for incorporating a business is known as the ‘articles of incorporation.” And, filing fees need to be paid to appropriate state agencies.
Incorporating a business has several advantages. Even if your operation is a single person one forming a corporation means creating a separate legal entity which is a separate individual. According to business gurus incorporating is a must as it:
1. Protects the owners from personal liabilities. This means you and your family or partners will not be legally liable for any business related payments in case of debt. Incorporating a business protects your home and personal assets from risks.
2. Corporations pay lower taxes and do not pay social security, Medicare, and workers compensation and so on. This is almost 15.3% in taxes and payable by individual proprietors. As a corporation you will save money.
3. Incorporating a company as a c-corporation can save almost 15% tax. By dividing the income between the corporation and shareholders business save thousands of dollars every year. Greater savings lei in re-investing profits in other business ventures and employee perks.
4. Corporations can deduct business losses and these can be carried back three years and forward for 15 years.
5. In a corporation, great savings are made by introducing retirement plans and corporate matching programs.
6. A corporation ensures continuity of the business even after the demise of the owner or shareholder.
7. Setting up a corporation results in adoption of modern management techniques and creation of central management systems. This prevents duplication of efforts and smooth functioning of the organization.
8. Setting up a corporation means ownership can be easily transferred by transferring the stock held.
Incorporation lends business longevity and protects it from inheritance squabbles. Incorporation can also be done such that it offers anonymity to its owners. When a business is a corporation it is easier to raise capital and sell stock or equity to raise operating funds. Investors and financial institutions are less likely to invest in a company that is individually owned.
By: Arthur Raise
Incorporating a business has several advantages. Even if your operation is a single person one forming a corporation means creating a separate legal entity which is a separate individual. According to business gurus incorporating is a must as it:
1. Protects the owners from personal liabilities. This means you and your family or partners will not be legally liable for any business related payments in case of debt. Incorporating a business protects your home and personal assets from risks.
2. Corporations pay lower taxes and do not pay social security, Medicare, and workers compensation and so on. This is almost 15.3% in taxes and payable by individual proprietors. As a corporation you will save money.
3. Incorporating a company as a c-corporation can save almost 15% tax. By dividing the income between the corporation and shareholders business save thousands of dollars every year. Greater savings lei in re-investing profits in other business ventures and employee perks.
4. Corporations can deduct business losses and these can be carried back three years and forward for 15 years.
5. In a corporation, great savings are made by introducing retirement plans and corporate matching programs.
6. A corporation ensures continuity of the business even after the demise of the owner or shareholder.
7. Setting up a corporation results in adoption of modern management techniques and creation of central management systems. This prevents duplication of efforts and smooth functioning of the organization.
8. Setting up a corporation means ownership can be easily transferred by transferring the stock held.
Incorporation lends business longevity and protects it from inheritance squabbles. Incorporation can also be done such that it offers anonymity to its owners. When a business is a corporation it is easier to raise capital and sell stock or equity to raise operating funds. Investors and financial institutions are less likely to invest in a company that is individually owned.
By: Arthur Raise