As an aspiring web business owner, you want to make sure your business is built to last. One of the very first steps in the process of formalizing your business is to incorporate the firm. While your business may be at an early stage (perhaps it’s only an idea), incorporating services will help you limit liability, facilitate tax filings and make it easier to conduct business with consumers and other forms. Giving your business a proper foundation through incorporation can ensure you are protected, whether you choose to organize as an LLC (limited liability company) or corporation (S or C-class) with shareholders. There are a variety of services you can utilize to help ensure you follow the proper protocols for incorporating and organizing your web startup. This guide will walk you through an example case for a web business owner looking to incorporate so you can understand how services might help your decision process.
The Process of Incorporating a Web Startup
While the legal process of using an incorporating service may seem like a formality, the experience can help you better understand your business goals. Therefore, take the opportunity to make sure you fully understand the unique aspects of your business as well as your long term plan rather than just filling out the forms to help a provider register your firm. Working with incorporating services can make it much easier to file since there are formalities, but the basic characteristic questions asked by the filer will help you to conceptualize your business formation goals.
If you’re like many startup owners you only have a broad concept for the business – incorporation is a great opportunity to sharpen that thinking. When you incorporate your business, you do this on the state in which you have an office as well as filing with the IRS for tax purposes. If you’re just starting out you can use your home address or a registered agent, which serves as a placeholder address based upon an agreement.
The first issues when organizing your business is think about ownership, liability and operations aspects of the firm. To start, you should identify whether you are going to be the sole owner or whether you may bring in partners or investors in the future. If you’re a sole owner, then you may want to file as an LLC, which is a pass through entity that allows you to protect your assets while making it easier to organize the firm legally. On the other hand, there are tax and distribution issues to consider if you’re considering taking on new investors. Most states require you to file an Articles of Incorporation as well – an incorporation service can help you determine the structure for these as well as ensuring you file all of the necessary paperwork. To successfully register your business you will need to meet all requirements of the Secretary of State, and incorporating services will double check your filing for completeness and accuracy. In some cases you may want to refer to a business attorney to clarify any particular aspects of incorporating, while incorporating services can provide a base level of organization for your firm.
