Advantages of Incorporating Liability and Asset Protection By incorporating a business, the corporation becomes a separate legal entity from its owners, otherwise known as shareholders. Because of this, incorporating your business will allow shareholders to cease being personally responsible for any debts or claims against your corporation. Therefore, if any one person would be seeking to collect debt, sue, or enforce a claim against an incorporating business, then they would not be able to collect from the business owners themselves but must instead attack the corporation, which would have more protection than personal assets. This way, business owners and shareholders have the ability to safely keep their business assets and personal assets separate when incurring liability in the corporation work and can avoid the overwhelming stress that some unincorporated business owners feel during instances of lawsuits or claims. It is important to note that the limited liability protections and the corporate veil in place in Nevada LLCs are very strong and help many owners resolve conflicts quickly through an efficient judicial system that is well informed of corporation laws. Tax Savings By starting a corporation in Nevada, many are thrilled to see that the tax savings are numerous and can certainly help business owners in their liability and profits. In general, corporations see many advantages in their tax savings when they choose to incorporate their business. First of all, a corporation can choose to defer their losses instead of being forced to take losses right away as is required of an individual. It is natural that many new and seasoned businesses will incur losses, and this allows corporations to spread their tax losses out over time. Additionally, an incorporated business is clearly allowed to deduct the benefits that they pay their employees, unlike an unincorporated business that is not allowed to deduct those benefits. Furthermore, when analyzing income to be taxed, corporations can lower their tax bills by taking their incomes in dividends rather than salaries, thus allowing them to become flexible with their income decisions away from their own company. This benefit allows decision makers to have more freedom and creativity in running their companies with more income flexibility. Why does it make sense to incorporate in Nevada? Although many corporations have commonly incorporated their businesses in Delaware, it is also a well-known fact that Nevada is a perfect state to begin incorporating your business. is a great state to incorporate your business. First of all, many business owners rejoice from the fact that Nevada does not have any state corporate income tax, nor does it impose fees on any corporate shares. Nevada also does not impose any personal income tax or any franchise tax for corporations or LLCs which has business owners cheering on the state’s legislative endeavors to bring in more business and profit. Also, shareholders, directors, and officers of a corporation that is incorporated in Nevada also do not have to be Nevada residents. In terms of management, there are no operating agreements or annual meeting requirements for members and shareholders of a Nevada corporation, which have many busy business owners and managers sighing with relief. What are the different incorporation options and types? There are a few major and minor differences and advantages between a C corporation, S corporation or limited liability company (LCC) from which business owners can choose when they choose to incorporate. For starters, a C corporation is one in which an income is taxed twice as it is taxed to the business and then to shareholder. A good thing about C corporations is that there is no limit on shareholders that can become involved and C corporations also allow foreign investors. On the other hand, an S corporation is only taxed once to shareholder; however, you cannot have more than 100 shareholders in an S corporation, and they must be U.S citizens or permanent residents. Another major difference between the two types of corporations is that C corporation have preferred stock that they can choose to distribute to shareholders. Although preferred stock may not always come voting rights, it can include guaranteed dividends which many shareholders greatly appreciate. Instead, an S corporation can issue common stock only since common stock shareholders receive voting rights. In these situations, no one shareholder has preferred status. Instead, all shareholders are treated equally. Lastly, unlike and S or C corporation, an LLC allows more flexibility in management structure and flexible tax reporting options, however it is also not sadly recognized outside of the United States and is not preferred by outside investors. Other differences between corporations and LLCs can include the fact that corporations have more rigid structures and legal compliance in general and the IRS is more restrictive regarding ownership for corporations rather than LLCs. On the other hand, LLC have simpler business operations and minimal requirements. What are the registered agent requirements? In corporation law, a registered agent, otherwise known as a resident agent or statutory agent, is someone who is authorized to accept legal important documents on behalf of a business or company. Although states allow business owners to be their own registered agents, the position comes with certain requirements which may seem unattractive to already busy and overwhelmed business owners. For instance, an agent must be available during all regular business hours and their information must go on public record, meaning anyone could contact you at any time. Also, agent duties can have dire consequences. For example, if an agent misses an important filing deadline then they could risk being fined or even shut down. Agents must be adept at regulatory frameworks, documentation, organization, and scheduling at all business hours. Does this come with any fees? Yes. Although Nevada does not impose any taxes for corporations or income, they do require an initial and annual statement fee and a business license fee. Please see the link to Nevada’s Secretary of State website below for more in-depth information. What are the key steps for initial registration and compliance? In order to get started in incorporating your business in Nevada, there are a few initial steps that business owners must first take. First, your business must choose a corporate name. Nevada’s business name database will allow you to check your corporation name for availability and create a name reservation request for 90 days. Next, you must file your articles of incorporation with the Secretary of State and these articles must include: the corporate name and address; the name, address, and signature of an agent for service of process; the number of shares with or without par value the corporation is authorized to issue; the names and addresses of the board of directors; and the name and address of the incorporator. The registered agent must complete and sign a certificate of acceptance, which is included with the Articles of Incorporation form. Then you must go on to file a list of officer’s applications, appoint a registered agent, set up corporate bylaws, hold a board of directors meeting and then issue stock. Please see links below for complete forms and applications and more information on the registration process.

SUMMARY OF INCORPORATION STEPS

Liability and Asset Protection

By incorporating a business, the corporation becomes a separate legal entity from its owners, otherwise known as shareholders. Because of this, incorporating your business will allow shareholders to cease being personally responsible for any debts or claims against your corporation.

Tax Savings

In general, corporations see many advantages including: paying income tax on net income (after deducting business expenses), lower effective tax rates that individuals in many cases, deductions for deprecation and others.

What are the different incorporation options and types?

There are a few major and minor differences and advantages between a C corporation, S corporation or limited liability company (LCC) from which business owners can choose when they choose to incorporate (as explained in detail below).

What are the registered agent requirements & fees?

In corporation law, a registered agent, otherwise known as a resident agent or statutory agent, is someone who is authorized to accept legal important documents on behalf of a business or company.  States require an initial and annual statement fee and a business license fee. Please see the link below for more in-depth information.

What are the key steps for initial registration and compliance?

In order to get started in incorporating your business there are a few initial steps that business owners must first take. First, your business must choose a corporate name.  Next, you must file your articles of incorporation with the Secretary of State and create several other books and records.

READY TO BEGIN?