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by Jacques Luben, Editor
Inc. Plan Business Review
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5 Important Reasons to Incorporate
Your Business Now
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Download this article as a PDF file > Click
Here
The American workplace is shifting dramatically as millions of company
employees choose to become part-time (or full-time) Independent Contractors.
The ranks of these new Business Owners is increasing every day.
We all understand the Joys of Self-Employment -----
No Boss ... Flexible Hours.... Lower Taxes.... Casual Dress....
The Ability to make your own Decisions about your Livelihood ....
Many Independent Contractors are not fully aware of the potential
tax advantages and liability risks of operating their own businesses.
The information provided below can help guide you through some of
the critical issues facing every Business Owner.
Q: What are some of the most important
goals that each Independent Contractor must reach?
A: Establishing credibility for the
enterprise.... Protecting personal assets from business related lawsuits
... Paying the lowest legally acceptable level of taxes on the company's
profits.
Q: Does
establishing a corporation (or LLC) help achieve these goals?
A: Absolutely. There are 5 primary
reasons why Independent Contractors typically decide to incorporate.
1. With
a corporation, the Business Owner establishes instant credibility
for his venture.
He (or she) is now the President of a company that is properly structured to
generate respect from customers, suppliers, banks, investors, lenders and others.
2. The
corporation provides a protective wall that shields the Business
Owner's personal assets if his corporation becomes the target of
lawsuits that are related to company activities.The Independent Contractor's
home, cash, retirement savings and other assets cannot normally be
confiscated to satisfy a legal judgement against his (or her) corporation.
3. An
incorporated business can operate very easily out of the Independent
Contractor's personal residence. This "Home Office" arrangement
can create valuable business deductions that reduce the amount of
income taxes that are payable to the Federal and Local Government
at year-end.
A sound corporate structure also provides valuable tax deductions
for health insurance, telephone, travel, entertainment and other
legitimate expenses that help reduce the company's tax bill.
4. If
the Independent Contractor performs work for a small number of clients,
the corporation can help prevent him (or her) from being treated
as a company employee for income tax purposes. This is a very important distinction because when
the Independent Contractor is incorporated, his clients are not generally obligated
to withold the income (and FICA) taxes that are applied to employee wages.
5. The
corporate (or LLC) structure normally reduces the Independent Contractor's
business insurance and liability costs. Remember, if your personal
assets are protected from your company's lawsuits, you have fewer
assets to insure and less premiums to pay.
Inc. Plan (USA), Inc. has helped thousands of independent
contractors form Corporations and Limited Liability Companies in
50 states since 1990. We welcome the opportunity to assist you with
your specific needs as an entrepreneur.
Our firm is networked online to the Secretary of State's office
in Delaware. This allows us to clear and reserve your corporate name
as soon as you contact us.
We can be reached at 1-800-462-4633 (in the U.S.) or (302) 428-1200 (Int'l.).
Please Email us at info@incplan.net.
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