Which Type is Better for My Business, an LLC Registration or a Corporate Registration?

of Advocacy figures that in 2007 there were over 27 million businesses in operation in the United States. Six million companies had workers and 20 million companies did not according to 2005 census data. 99 percent of the 27 million businesses employ less than 500 employees according to the most recent SBA information.

Nearly every business commences its journey as a small startup. In the beginning, data exposes that 82% of the small businesses are financed by private loans or savings and loans from friends and relatives. So, when these firms grow large, it is important that easier access to finance from banks and the public is available. Because of this proposed business growth business owners start out to look for ways to decrease their personal financial risk.

Developing a checklist before starting a business is usually a healthy first step and it should look something like this: pick out a tax year (fiscal year), determine on an appropriate business structure and choose an accounting method that works for your particular industry. The need for incorporation arises if the business structure chosen is either a LLC or corporation. Choosing any corporate structure requires mandatory fillings with state and federal agencies. If you choose to structure your business as a sole propietorship or partnership, registration may not be needed and business activites could begin immediately. If you determine to pursue the corporate structure for your business, you must also consider the costs of obtaining adequate legal and accounting advice that will ultimately be required.

The procedure for incorporating your business is simply the act of completing the inevitable paperwork and filing it with the appropriate state agencies in the state you choose to incorporate. Filing the papers can be done by hiring the services of an incorporating agency. Most of these incorporating agencies will handle the task of preparing and filing the necessary paperwork in whichever state you pick out to incorporate your business. Choosing a corporate friendly state, like Nevada or Delaware, may be a route you would select to take, if your business is open to incorporate in a state in which you do not reside.

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To Incorporate
To Incorporate