Corporation and LCC Registration
Legitimacy can be gained by the formation of a strong and reliable business structure. Not only does a formal business structure provide you more credibility it also provides you protection. An entrepreneur without a formal business structure has no protection against unlimited personal liability and does not have the same credibility and tax advantages as a Corporation (Inc.) or Limited Liability Company (LLC).
Choosing the legal business structure: sole proprietorship (is the structure a business is by default), partnership, corporation or Limited Liability Company.
Advantages: You’re the boss, it’s easy to get started, you keep all profits, and, Income from business is taxed as personal income.
Disadvantages: You assume unlimited liability, the amount of investment capital you can raise is limited, you need to be a generalist, retaining high-caliber employees is difficult, and the life of the business is limited.
Advantages: Two heads are better than one, easy to get started, more investment capital is available, partners pay only personal income tax, and high-caliber employees can be made partners
Disadvantages: Partners have unlimited liability, partners must share all profits, the partners may disagree, and the life of the business is limited.
Advantages: Stockholders have limited liability, corporations can raise the most investment capital, corporations have unlimited life, ownership is easily transferable, and corporations utilize specialists.
Disadvantages: Corporations can be taxed twice, (avoided by forming a S Corporation) corporations must pay capital stock tax, and starting a corporation is harder.
Limited Liability Company (LLC)
Advantages: Limited liability like a corporation limits your personal liability from business debts, tax simplicity that resembles a partnership the business profits and losses of an LLC are taxed at individuals’ income tax rates dividing up profits among the LLC members, and it is not restricted to the members’ capital contributions.
Disadvantages: Not as formal as a corporation, less tax breaks than Corporation
I have helped many businesses become more successful by helping them of form a Corporation or Limited Liability Company.