Owning your own business is tough work but the rewards can be great; after all, small business ownership has made more people wealthy than any other single factor including stocks, bonds or even real estate.
Incorporating your business helps shield your personal assets from your business assets and risk and, depending upon your specific situation, may provide numerous tax advantages.
Incorporating your business is a smart idea, as it gives you and your fellow shareholders limited liability, meaning you can’t be held personally responsible for the actions or debts of the corporation. Regular for-profit corporations, also known as c-corps, are treated as a separate legal entity from their owners or shareholders. Corporations can enter contract agreements, raise funds through stocks, and can be taxed and sued.
- You want to limit your personal liability for your business’s actions and debts - You want to be able to sell stocks to raise funds - Heavier taxes and stricter regulations and monitoring won’t damage your business practices
