×

Switch Account

Done With Your Business Plan? 5 Reasons Why Incorporating Should Be Your Next Move in 2014

Done With Your Business Plan? 5 Reasons Why Incorporating Should Be Your Next Move in 2014

Guest post by E.J. Dealy is CEO of The Company Corporation, which helps entrepreneurs and small business owners with incorporating and forming business entities. The Company Corporation does not provide legal, financial, or tax advice.

 

 

It began with an idea, built upon a dream to spread messages to an eager audience, or to offer consumers certain products and services. Passionate and dedicated supporters – family members, loved ones, and business partners – fueled your ambition. Maybe this idea grew from a childhood memory, or evolved under the tutorage of a mentor. No matter how this seed was planted, you have probably spent years developing a solid business plan. So, what’s your next move?

 

Incorporating the brand should be top of mind prior to launching a privately owned business. It is an important step, adding security and legitimacy, no matter the organization’s size. Forming an LLC, or Limited Liability Company, comes with multiple advantages:

 

1. Protecting Brand Name and Personal Assets – Of all the assets you can protect legally by forming an LLC, both physical and monetary, that of your brand name is a key item to own. In most instances, another entity cannot file the same name as an existing corporation in that state. This protects the LLC on two fronts: The first is reputation management, keeping your company rep from being diminished or compared to an unscrupulous organization with a similar title. The second benefit: Recognition. This not only solidifies your image with a product or service, but helps with marketing and future branding strategy.

 

While a name is key to such strategy, you are nothing with the allocation of assets. With an LLC formed, you gain the advantage of personal asset protection. In the event of a negative financial impact, i.e.: lawsuits, personal assets are separated from those of the business. Owners with limited liability won’t have to see their personal assets taken away to recoup a business loss. This is seen as the absolute top benefit to consider before incorporating.

 

2. Legitimizing the Business – Credibility is another key advantage to forming an LLC. It may seem like a minor detail, but legally adding “LLC or “Inc.” to a title affords the business instant legitimacy. By including this level of protection, both partners and consumers will know your service is protected under legal guidelines, scrutinized in a way so they feel it is safe to proceed with an engagement.

 

3. Tax Benefits – Owning your own company means dealing with multiple forms of taxing. Luckily, incorporating a small business adds the additional benefit of tax flexibility. One can opt to have the organization taxed as a corporation. Special statues, such as Subchapter S, help to navigate around issues like double taxation of corporate profits. Keep in mind that a small business’s profit, as well as any loss, is typically reported on through personal income tax.

 

4. Deduct ALL THE THINGS! – Ever see coffee shop owners driving luxury SUVs as rolling billboards? Or a tiny shop, in business for 3 days, handing out t-shirts and stocking products wall-to-wall? This is, in part, thanks to deductions. Incorporated businesses are allowed to deduct anything considered “normal business expenses,” which may include register printer tape or car wraps used for marketing. Best of all, salaries can also be deducted.

 

5. Immortality, to an extent – Whether you remain sole proprietor or decide to sell the business, LLCs exist after management has changed. Incorporating means a company’s heritage will move forward, keeping employees and clients pleased.

 

VZ Webinar Series ICON.jpgFor more tips and insights join my colleague, John Meyer, this Wednesday at 2 p.m. ET as he and David Crocker with Chase Paymentech are featured guests on the Verizon Webinar Series. Click here to register (free) or visit http://vz.to/1aSbawT.

 

Browse Categories
Categories:
Posts
About Verizon Business Markets
Get news from Verizon about Business Markets services and market trends that affect your bottom line. Here, you'll find tips and commentary from the Verizon Business Markets group and other experts to help keep your business growing.

       




Contact the editor: tumara.r.jordan@verizon.com