To Incorporate Or Not To Incorporate Your Business

1. Blog1 - Shieldcorp.net To Incorporate Or Not To Incorporate Your Business As you delve in the affairs of business, there come many terminologies which you have got to be acquainted with. But the very first question that you have to ask yourself is whether you should incorporate your business or not. Is it possible for you run your business successfully without getting it incorporated? Like all other things this aspect also has its own merits and demerits. The merits of incorporation When you tend to run your business on sole proprietorship, your personal assets are also liable to business related risks. Incorporating the business makes your personal assets and business assets separate identities. You have to pay less tax. Expenses towards insurance, travel, consultancy, entertainments etc are considered business expenses and hence tax deductable. Continuity of the company is assured beyond its owner. Incorporated companies attract investors. As the responsibility is shared, the company is protected from harmful decisions. The demerit of incorporation It requires huge paper work and documentations. Each state has its own sets of law. For example the state of Nevada has quite friendly incorporation laws that attract many businesses there. Cost of setting incorporated business is high. Low profit status may cause you, miss tax benefits. While incorporation you should also look about the place which is the best. States like Delaware and Nevada offer special advantages. Incorporation in Nevada gets you no corporate income tax, no personal income tax, no need of stockholders and shareholders to be USA citizens and many more.