Most states have statutes providing for incorporation by those performing specific types of professional services such as doctors, dentists, accountants, lawyers, architects, etc. These corporations are set up and operated similarly to a regular corporation but there are a few…

A “closely held corporation” is a general term used to describe a smaller privately held corporation with few shareholders, usually family members or close associates. On the other hand, some states have adopted special statutes for a “close corporation” which…

The short answer is that incorporating Nevada or Delaware will probably cost you more money. In addition, it may provide few substantial advantages unless you have a giant corporation and live in one of those states or are doing most…

Most small corporations should not be looking to incorporate offshore. First, if it is done for tax purposes, you are likely to substantially increase your odds of getting audited by the IRS since there are many offshore tax schemes that…

The main advantages of incorporation are 1) liability protection, and 2) tax savings. The liability protection provided by incorporating simply means that if your business is sued and the person suing is successful in getting a judgment, they can only…

The main disadvantage of doing business as a sole proprietor (one person) or partnership (two or more individuals) is the risk of liability. You have no limited liability protection like you do if operating in the corporate or LLC form.…

The two most important considerations for most small businesses are 1) liability protection and 2) tax considerations. Textbooks sometimes cite other issues such as perpetuation of the entity, continuity, ability to raise capital, etc. However, in my experience, these are…

S corporations and LLC’s are similar in both the way they provide liability protection to the owners and in the way they report taxes. Both provide limited liability protection to the business owners. It has been suggested that the liability…

The difference between a regular C corporation and an S corporation is in the way taxes are reported and paid. Both types of corporations are initially formed as regular C corporations. Both are subject to the same state corporation laws…

Some new or start-up businesses operate as sole proprietorships due to the ease and low cost of starting up. However, if the business owner desires to operate in one of the legal forms or entities, the most common and practical…