10 Top Tips for Incorporating Your Small Business
June 29, 2015 by Aaron Scott Young
1. Start With The End In Mind.
What are your long-term goals? Are you going to need to raise capital? Will you have partners? How are you going to exit the business? These are just a few things you need to consider.
2. Understand Your Options.
Corporations and LLC’s vary in management, benefits and taxes. Comparing your options is important in making the right decision.
3. Know the benefits.
Corporations and LLC’s offer liability protection, tax savings, credibility, legitimacy, estate planning, and numerous other benefits, but they are not created equal.
4. Understand Your Obligations.
When you incorporate or form an LLC you need to stay legal to keep your liability protection. This includes but is not limited to minutes, resolutions, annual meetings and federal and state filings.
5. Know When To Form Your Company. Timing is Everything.
If you’re getting ready to start a business, have personal assets to protect or are already in business, then the time to incorporate or form an LLC is now.
6. Choose a Company Name.
If the name you want is similar to another business name or includes restrictive words, then the state may reject it. Try our company name search to secure your desired company name.
7. Pick A State.
Most people will incorporate in the state in which they do business. Where you incorporate is where you will need to meet the legal requirements for operating.
8. Form Your Company.
- Do –It-Yourself: Filing the documents can be confusing and costly if done wrong
- Hire an attorney: Can be expensive
- Use a service that specializes in business structuring
9. Understand How your Companty Will be Taxed.
C-Corporations are taxed at their own tax rate.
S-Corporations are taxed at the individual share-holders’ tax rates
LLCs can be taxed four different ways: as Sole Proprietorship, a Partnership, a Corporation or S-Corporation.
10. Do It Right.
Making the wrong choice can cost you extra fees, additional taxes, reduced benefits and loss of liability protection.
Ready to get started with your company formation?
