Other benefits to incorporating:

Adds Credibility
A corporate structure communicates permanence, credibility and stature. Even if you are the only stockholder or employee, your incorporated business may be perceived as a much larger and more credible company. Seeing ",Inc." or "Corp." at the end of your business name can send a powerful message to your customers, suppliers, and other business associates about your commitment to the ongoing success of your venture.

Tax Advantages - Deductible Employee Benefits
Incorporating usually provides tax-deductible benefits for you and your employees. Even if you are the only shareholder and employee of your business, benefits such as health insurance, life insurance, travel and entertainment expenses may now be deductible. Best of all, corporations usually provide an increased tax shelter for qualified pensions plans or retirement plans (e.g. 401K's).

Easier Access to Capital Funding
Capital can be more easily raised with a corporation through the sale of stock. With sole proprietorships and partnerships, investors are much harder to attract because of the personal liability. Investors are more likely to purchase shares in a corporation where there usually is a separation between personal and business assets. Also, some banks prefer to lend money to corporations. This is not as common at the small business level as it sounds, because it can be complicated and require the proper attorneys to make sure you are not violating any security laws. Unfortunately, many still get investors and never consult with a proper securities attorney.

An Enduring Structure
A corporation is the most enduring legal business structure. Corporations may continue on regardless of what happens to its individual directors, officers, managers or shareholders. If a sole proprietor or partner dies, the business may automatically end or it may become involved in various legal entanglements. Corporations can have unlimited life, extending beyond the illness or death of the owners.

Easier Transfer of Ownership
Ownership of a corporation may be transferred, without substantially disrupting operations or the need for complex legal documentation, through the sale of stock.

Anonymity
Corporations can offer anonymity to its owners. For example, if you want to open an independent small business of any kind and do not want your involvement to be public knowledge, your best choice may be to incorporate. If you open as a sole proprietorship, it is hard to hide the fact that you are the owner. As a partnership, you will most likely be required to register your name and the names of your partners with the state and/or county officials in which you are doing business.

Centralized Management
With a corporation's centralized management all decisions are made by your board of directors. Your shareholders cannot unilaterally bind your company by their acts simply because of their investment. With partnerships, each individual general partner may make binding agreements on behalf of the business that may result in serious financial difficulty to you or the partnership as a whole.

Do I need an attorney to incorporate?
No, an attorney is not a legal requirement to incorporate. You can prepare and file the articles of incorporation yourself; however, you should understand the requirements of your intended state of formation. You can use our service to incorporate and not only save money on attorney fees but rest assured that all forms are filed properly.

What are the disadvantages of incorporation (these are some reasons many stay a sole proprietorship even though that may be a very bad idea for them)?

1. There is more complexity and expense with forming a corporation.

1. There are more extensive record keeping requirements.

1. The cost involved is more than just being a sole proprietorship.

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