"LLC" and "Corporation" have many of the same characteristics. The most important characteristic they share is that they both offer limited liability protection to thier owners. Typically, shareholders are not liable for the debts and obligations of the corporation; thus, creditors will not come knocking at the door of a shareholder to pay the debts of the corporation. In a partnership or sole proprietorship, the owner's personal assets may be used to pay debts of the business. With an LLC, the members are not personally liable for the debts and obligations of the corporation. There are many important differences between the corporation and LLC. The entities are taxed differently. An LLC is a pass-through tax entity. This means that the income to the entity is not taxed at the entity level; however, the entity does complete a tax return. The income or loss as shown on this return is "passed through" the business entity to the individual shareholders or interest holders, and is reported on their individual tax returns. With a standard corporation, the corporation is a separately taxable entity. Corporations are treated as separate legal taxable entities for income tax purposes. Therefore, corporations pay tax on their earnings. If corporate earnings are distributed to shareholders in the form of dividends, the corporation does not receive the reasonable business expense deduction, and dividend income is taxed as regular income to the shareholders. Thus, to the extent that earnings are distributed to shareholders as dividends, there is a double tax on earnings at the corporate and shareholder level.
This is a common concern among many small business owners because they associate corporations with only the largest business entities. However, forming a corporation is very inexpensive. All of our packages are fully tax-deductible. Our consultants can show you how to completely offset your incorporating costs with real tax savings!
We can begin today and in some cases (like Nevada), have your corporation formed within 24-hours. All states differ in the turnaround time of their processing of your corporation. However, through relations with the various state offices, we strive to maintain the fastest turn-around times in the industry. Call and speak with one of our consultants to obtain the average turn-around time for any given state.
In most cases, the answer is no. In most states, InCorp assigns itself as the "incorporator" and is able to file all of the paperwork without an offi's signature. Some states require the officer's signatures on the Articles of Incorporation. In those cases, we will overnight the documents to you for your signature and have you return them to us, or use a facsimile signature to fulfill the requirement. In either case, you are not required to be present to form your corporation.
Getting started is easier than you think! Click here to receive one of our information packets, or call us at 1-800-2INCORP (1-800-246-2677) today to speak with one of our consultants. We will give you a free consultation with no obligation to purchase!
A lot of companies are out there touting the benefits of incorporating your business in Nevada, Delaware, or Wyoming. However, in most cases, the solution just is not that simple. Oftentimes, companies are required to register their business in the state they are located in and lose all of the benefits of incorporating. Meanwhile, you are out a lot of time and money.
At Incorp Services, we analyze your business and structure you according to your needs and the laws of the states you are doing business in. Structuring a business for tax benefits and asset protection is very complicated and oftentimes a cookie-cutter solution just won't do. For more information on which structure is right for you, contact us or go to the information portion of our website.
First, the corporation is required to file Articles of Incorporation with the state it is registering in. After the company has been incorporated, the company must adopt a set of By-laws. Temporary officers and directors do this during the initial meeting of officers and directors. After the By-Laws have been created and accepted, a stock must be issued with stock-subscription agreements. After the stock has been issued, a meeting of shareholders must take place where the shareholders vote on who will be accepted as the officers and directors of the corporation. To the average person, these procedures seem foreign and complicated, however, they are very easy and we give you the tools you need to perform these functions efficiently.
No. This is a common misconception among small-business owners, usually fostered by advice from an inexperienced accountant. Any seasoned advisor will tell you that incorporating is the first and foremost thing you should do when starting a business. Incorporating (or forming an LLC) will not only save you taxes (no matter what your income) but it will also limit your exposure to IRS audits by separating your personal and business expenses.
Unfortunately, no business is safe anymore from lawsuits. The United States is the most litigious country in the world. In 1992 over 19 million civil lawsuits were filed in this country alone. This trend has been continuing and increasing since then. With the low costs of incorporating, it doesn't make sense not to do so considering the great risks one takes by being unprotected and exposed to litigation.
C" Corporation is just a standard corporation filed with the state that you wish to incorporate in. It is subject to the federal corporate tax structure. An "S" Corporation is the same as a standard "C" Corporation but with an "S-Election" (form 2553) filed with the IRS. This entity is known as a pass-through entity because the income of the corporation is "passed-through" to the individual very similar to a sole-proprietorship. [Side by side comparisons of these entity types]. Determining which entity is right for you is directly contingent upon the type and size of your business and your individual situation. In one of our free consultations, we will be able to assist you in determining which entity is right for you. Contact Us to have one of our consultants help you determine your business needs!
The main negatives are the restrictions. There cannot be more than 75 shareholders; non-resident or non-US citizens may not be shareholders, and the tax year is somewhat inflexible (it usually must end on Dec. 31). Additionally, another corporation cannot own an “S” corporation.
