Incorporating: S corporation or LLC

Posted by philip

April 14, 2008

If you’re running a successful small business you may have thought about incorporating. Incorporating is a great way to get some tax advantages and some liability protection. And incorporating may just be easier than you think. Incorporating or setting up a corporation in the past always involved major legal expenses. Incorporating has always been thought to be too costs prohibitive because of these expenses and fees. Well times have changed, Incorporating online has now become the easy way to incorporate a small business. It’s as simple as filling out the correct forms. Why pay an expensive attorney, just to feel out forms? Incorporating online has made thing not only easier but cheaper as well.
Before incorporating you’ll have to choose between an S corporation or LLC.

Depending on your unique situation an S corporation or LLC may be the best fit. Generally speaking an LLC is the easiest to set up and maintain. An LLC is also the obvious choice when it comes to real estate companies. An S corporation involves a bit more administration. The trade off with S corporation is that you can save on self-employment taxes. This is often the big disadvantage to the sole proprietorship. You’ll want to research further to see if a S corporation or LLC is right for you.

Often with sole propiertors they have to utilize their own credit. If you’re in need of credit repair this isn’t always helpful for your business. By incorporating you’re separating the credit status from personal to an entity, so you don’t have to worry about credit repair. Credit repair and credit work similarly with individuals and corporations, in that they both can be built up.

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