Incorporate my business

[Mark Argerake]

What it the best, fastest, cheapest LEGAL way to incorporate a biz? What's all this hoot I hear about Delaware? Can I incorporate there if I dont live there?

[Steve Clodfelter]

Yes, you can incorporate in Delaware even though you don't live there. But if you (or you and your wife) are the sole owners of your business, there is probably no reason to incorporate in any state other than the one you live in. The main advantage of incorporating in the state in which you live is how easy it is.

If someone other than you and your wife own your business, you should consult an attorney. If just you (or you and your wife) own your business, go to your state's secretary of state's office and ask for the forms to incorporate your business. They are SIMPLE to fill out. You might even be able to download them off the secretary of state's website. After you fill them out, send however many copies the instructions ask for to the address they say to send them to. Easy as pie. Total cost will be whatever the state charges, usually about $50.

After you incorporate, remember to hold regular corporate meetings, set up a corporate banking account, etc. You MUST treat the corporation as separate from you personally or you will lose the benefits of having incorporated your business. The secretary of state's office may have a brochure explaining what all you need to do.

[Dan Holly]

Note; I'm not a "legal eagle" by any sort, (or claim to be)so don't hold me to the facts....heh

One of the reasons business incorporate in Delaware is because it's harder for other companies to perform "hostile takeovers".

I would suggest spending the money to talk to an attorney regardless of your situation. They can advise you of the ups and downs of the tax situation in your particular situation, and the different kinds of corporations. Even marital situations can drive the type of corporation you form.

Hope this steers you in the right direction........

[Mark Argerake]

Thanks everyone.

All great advise. But even thouht I still have questions about the different types of Corps (llc, s...) ~ bottom line is I really NEED to talk to a lawyer. I guess I'll start a new thread looking for one. I'm probably going to need to hook up with an accountant too to make sure I keep everything straight. Two new threads here I come.

[Bob Safay]

There are different rules depending on your State. In Georgia it cost me about $80.00 plus the $15.00 annual renewal fee. I had to fill in the paper work and file it, $40.00 and then run an add in the Atlanta Buisness Cronical for two weeks, another $40.00. The State did a name search for me to determine if the name of the company was already in use. Or, you can do as a friend of mine did. Get a lawyer to fill out the papers and file it and place the add for you. That cost him $800.00!

[John Locke]

You might want to consider Nevada. Get an attorney to verify this, but if I understand correctly, you don't have to have a "registered agent" in Nevada as you do in Delaware. Plus, it's cheaper in the long run...and virtually no restrictions.

Here's information about incorporating in Nevada:
http://www.123-incorporate.com/incdata/whynevada.htm

Here's information about incorporating in Nevada:
http://www.123-incorporate.com/incdata/whydelaware.htm

And here's general info to consider on "where" to incorporate:
http://www.123-incorporate.com/incdata/whereto.htm

[Dirk Mitchell]

Bob,

I registered as a sole proprietor last year in Cobb County, but never renewed it because different obligations kept me from getting serious. Now I'm considering doing a small business again, but want to go the LLC or S-corp route. Are you registering with the State of Georgia or your home county? Can you forego the newspaper ad because all that got me were a hundred phone calls and coutless junk mail from people trying to sell me credit card machines.

What are your income tax implications? Obviously the easiest is sole proprietor, but I need to separate the business from personal and want the best way to do taxes, not that I'm expecting to make gobs of money.

Thanks.

[Don Donatello]

why a corp ? have you looked into a LLC
LLC gives you all the protection of a corp .. each tax year you have the choice to be either taxed like a corp or use pass thru - and you can change each year based on what is best for LLC ... plus you decide how much each person contributes and how much each persons gets in return ( does not have to be equal) ... LLC can be started with 1 person in many states , less paper work ... nolo press puts out a couple of books on LLC's ..

BUT if you want to sell STOCK then CORP is best ...

[Dirk Mitchell]

I agree. I think an LLC will be the way I go. I'm still trying to understand the nuances of them, like articles of organization for one. It seems like there are a lot of websites out there that will incorporate for you. How do I know which ones are not scams? Anyone use any of these services? And after I incorporate, do I still need separate license from the county where the business is?

I also can't figure out if Georgia requires at least two people to start an LLC.

[Don Donatello]

looking in my nolo's quick LLC book .. it states on page 2 .."all states save Mass. & district of columbia now permit the formation of single-owner LLC's (limited liability company) .. GA $75 fee appears to be a one time fee & i see no tax fee's ... in calif 70 fee PLUS $800 annual TAX fee ( more tax if LLC income is over 250K)

YES you still need county/city permit/license

links
http://www.nolo.com/lawcenter/index....757E247F35B8AB

http://www.nolo.com/lawstore/product...37A296A830F6E2

for georgia

http://www.sos.state.ga.us/corporations/llc.htm

[Robert Bobson]

Here in Michigan, you can set up a Corporation or an LLC on the State of Michigan website. They have an online "wizard" that walks you through filling out the forms step by step.

Then you print them and mail them in. Costs about $50 + small annual fee. Other state may have similar set ups.

[Thomas Berg Petersen]

I recently incorporated my LLC since I was shooting a film and didn't want to expose my private assets to any liability in case of accidents (eventhough I had insurance, but you can't really prevent anyone from suing you).

I spent a great deal of time of researching, and I finally went with a lawyer who knew what he was doing instead of me registering it online. It looks very inexpensive to do it online but there are several buts.

If you for example register the LLC inexpensively in Delaware but your business is in the State of New York, you will need a license to operate in New York State when you are a 'other state LLC'. This fee is $250 but then you also need a registered agent (who lives in Delaware) in Delaware and these usually costs app. $100 per year.

An other thing that many of the cheap websites forget to tell is that you are supposed to publish that your new-formed LLC is now operating in this state. There are only few news papers which offer this and you have to publish it for about 6 weeks. This easily runs up to over $1,000 (the papers have monopoly). So many websites 'forgot' to mention this. The result if you didn't publish your LLC formally and by the books, you would not be able to use the court system of the state you were doing business in i.e. if someone filed a lawsuit against you, you would automatically loose since you were not legally allowed to do business and the judge would by default rule agains you.

However, this legal practice has just been changed by a very new New York State Supirior Court ruling, that says this publication requirement is unconstitutional. So you don't have to spend $1,000 which makes things easier and cheaper.

My point is just that sometimes it is better to go with the professionals who are better able to inform you better than if you were to do it yourself.

I spend app. $400 for all the paper work. $200 in legal fees and $200 in mandatory state fees. It was really easy and in my opion worth the money, but that is of course subjective.

An other thing is that there are many filing fees that needs to be paid even you are doing it yourself. And sometimes the online websites don't inform you properly about these.

Hope this helps.

[John Heskett]

I also, just went through all of this stuff. I researched the online companies. I researched the LLC vs. Inc and thought I know what I wanted to do.

Finally I called a CPA/Lawyer where I live. I'm very glad I did. After talking with him we opted for the S-Corp. instead of an LLC. The reasons were many, but the highlights are, better personal protection, better handling of the money (there are legal ways to not pay social security tax on all that you make) and the complexity was not any higher that the LLC. The maintenance paper work was not any higher than the LLC.

So anyhow, it worked out better for me to go with the S-Corp. Going through the lawyer cost me $750, well worth it to do it right the first time.


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