| vantages to Incorporating | | | | virtually impossible to accomplish with other business |
| | | | entities. When you incorporate you create a separate |
| There's no question that hard work and a little luck is | | | | and distinct legal entity. Because of this, there are |
| what it takes to BE successful. But a little knowledge, | | | | many transactions that you can structure between |
| especially when it comes to setting up your business, | | | | you and your corporation to save big money on taxes. |
| will help you STAY successful. | | | | For instance, if you own a building you can rent office |
| While many business owners give a lot of thought to | | | | facilities to your corporation and claim depreciation and |
| location, store décor, customer service, hiring | | | | other deductions for it. Your corporation can then claim |
| employees and management issues (and rightly so); | | | | the rental expense. You are prohibited from doing this |
| choosing the proper business structure (such as sole | | | | if you are a sole proprietor or a partner in a |
| proprietor, partnership, corporation, limited liability | | | | partnership. |
| company) doesn't get the attention it deserves. Many | | | | Privacy and Confidentiality - The corporate form of |
| entrepreneurs don't realize this, but the business form | | | | business is a great way to keep your identity and |
| they choose can often times be the difference | | | | business affairs private and confidential. If you want to |
| between success and failure, especially in today's | | | | start a business, but would like to remain anonymous, a |
| competitive and litigious marketplace. If you want to | | | | corporation is the best way to accomplish this. States |
| succeed, you need all the advantages you can get. | | | | such as Nevada offer even more privacy protection |
| High on the list of safe bets is the corporate form of | | | | for corporations and their shareholders. |
| business. | | | | Easier to Raise Capital - When you're looking to raise |
| Incorporating, while definitely not for everybody, offers | | | | money through investment or borrowing, a corporation |
| several distinct and money-saving advantages over | | | | can actually make finding and getting the money you |
| the other types of entities. Here are seven of those | | | | need easier. If you want to take on investors you |
| advantages: | | | | simply sell shares of stock. If you want to borrow, a |
| Asset Protection - If you operate as a sole proprietor | | | | corporation can add clout when dealing with banks or |
| or partnership, there is virtually unlimited personal liability | | | | other lending institutions. |
| for business debts or lawsuits. In other words should | | | | Perpetuity - As I mentioned in #3, when you |
| you go out of business or be a defendant in a lawsuit, | | | | incorporate you create a separate and distinct legal |
| your personal assets such as homes, jewelry, vehicles, | | | | entity. This separate and distinct entity (the corporation) |
| savings, etc. are up for grabs. This is generally NOT | | | | can endure almost forever irrespective of what |
| the case when you incorporate. When you incorporate | | | | happens to the shareholders, directors, or officers. This |
| you are only responsible for your investment in the | | | | is NOT the case with sole proprietorships, partnerships |
| corporation. The limited liability feature of a corporation, | | | | or even limited liability companies. For example, if an |
| while not a guarantee, is DEFINITELY one of the most | | | | owner, partner, or member dies the business |
| attractive reasons for incorporating. | | | | AUTOMATICALLY ends or gets wrapped up in legal |
| Easier To Sell - Corporations are generally much | | | | red tape. Corporations, on the other hand, have |
| easier to sell and are usually more attractive to buyers | | | | unlimited life. |
| than either a sole proprietorship or partnership. The | | | | Increases Credibility - Let's face it. Most people feel |
| reason for this is because a new buyer will not be | | | | more secure and confident dealing with a corporation |
| personally liable for any wrongdoings on the part of | | | | as opposed to a sole proprietorship. Having INC. or |
| the previous owners. If someone buys a sole | | | | CORP. after your company's name adds a touch of |
| proprietorship, for example, the new owner can be | | | | professionalism and credibility to your business dealings. |
| held personally liable for any mistakes or illegalities on | | | | As always, be sure to consult with your attorney or |
| the part of the prior owner…even if the new | | | | business advisor before undertaking any important |
| owner had NOTHING to do with the situation! This is | | | | legal or financial decision. While there are many |
| usually NOT the case with a corporation. | | | | advantages and money-saving reasons to incorporate, |
| Tax Savings - When you incorporate there are | | | | as I've said before, it's not for everybody. However, |
| numerous tax advantages at your disposal that are | | | | you do owe it to yourself to find out more. |