Have you ever wondered what it means to be incorporated? If it’s really worth the time and money. . . . and anyway, just how much time or money might it cost? Is it for me or my business? How do I do it? And lastly, why haven't I heard about this before?
Well, the chances are you HAVE heard about it, but what you heard scared you off, or was erroneous. Until now, maybe you have not even done any personal research. You picked up a rumor or hint or innuendo here or there. . but that’s about all. No ACTIVE pursuit. . and again, probably because what you heard may have just discouraged you from even spending time on the subject.
Well, congratulations. You are finally at a place you can start comfortably.
Why do I write about those circumstances? Because I lived them, and to my extreme self disappointment, did not take the matters into my own hands to investigate.
I've been a small, one person, self employed business for 17 years. . and was NOT incorporated. You know, growing up, money and things like this just didn't get discussed in my family. Not that it carried any stigma like sex or the like. . my folks just didn't know. When I went to college, and even though I was an Economics “major", it didn't get covered in any of the classes. I sort of just emerged or morphed into being in business and never was big (or smart enough) to have a business advisor. I had an accountant, and he was good at keeping me compliant with IRS rules for the entrepreneurship type business I was in. I guess he figured I'd made a choice not to be incorporated. . my business structure was not his business; his business was keeping me compliant with the rules set forth for the business I was in. My principals (I was a manufacturers’ rep) probably figured I knew what I was doing, and anyway, as long as I was selling their products. what did they care. Then there’s my competitors. . . even the friendly ones. . or the guys at the Chamber of Commerce meetings. Like they care. . right? ? ?
But one day, in spite of myself, I did stumble into a good reference book, and it opened my eyes as big as dinner plates.
I learned that a small company (revenues less than $75,000, mainly commissions) COULD incorporate and do so professionally for under $1000; that if I had previously been incorporated (LLC or Chapter S), I could have paid about half as much in taxes as I did over the 17 years I'd been doing just a Schedule C, plus I'd have had far less liability.
Once I learned that this was possible, I started to go about learning how and where. . and this can make a difference.
It seems like the two best states are Delaware and Nevada, and Nevada has an edge because of state taxes.
And by the way, your local attorney or accountant unless licensed in those states is probably not going to be your best source of help or information, and certainly not the lowest in costs.
If you were to start your research on the Internet, you'll soon discover your next problem. . how to choose. You must be very careful here. There are firms that will sell you services for money you really don't need to spend, even if they deliver all the services. There are those who will seem to be real bargains at $300 or less. . but you get very little. The facts are you can get the forms and paperwork free from most states. . but not the “go with" guidance. . and if you are doing it yourself, you want some help.
The point: choose and evaluate carefully. If you do, you'll probably find yourself using the services of a mid- competitive-price service and you will get good value. You CAN do this yourself with a service. . and you'll be amazed how much you can save and benefit.
Don't do as I did for many years and ignore it or feel it can't be done. NOW is the time to begin and stop overpaying taxes.
Joe Leech is a small businessman who learned way too late
about the how and why of incorporating. He's learned now
and provides valuable tips, insites, and FREE resources
at his resource site at http://incorporateinfo.ouronlinebusiness.com