Information To Understand A Business Incorporation
Business incorporation may be something that you want to consider. A corporation is a legal entity created and recognized by the laws of the States.
Although the existence of the corporation is separate from its members, a corporation is regarded like a real person.
This means that it can enter into and dissolve contracts, sue and be sued. Corporations also pay taxes, apart from its owners. They are capable of
incurring debts, own and acquire assets, and sell properties and goods.
If business corporations are chartered by a state or federal government, it is recognized as a legal entity with rights, privileges and liabilities. There are
many reasons why you should do business incorporation.
Having a limited liability is among them. The owners, known as stock holders or incorporators, are given limited liability protection. This means that the
owners are not at high risk for satisfying corporate liabilities and debts.
A separate corporate tax is another. Because a corporation is a separate legal entity, it pays taxes separately as well; particularly if the corporation is
type C. Corporate owners pay taxes based on their salaries, dividends and bonuses.
Many businessmen are encouraged to join corporations because they are an attractive investment, considering its excellent built-in stock structure.
The stock structure is among the best strategy to attract talented employees by offering them ownership interest either by stock or stock options.
There are circumstances in which the business incorporation has its owner/s its employees. Hence, as an owner and employee, you are entitled for
benefits such as health and life insurance. And you will have tax deductions.
State laws dictate that corporations follow an organizational structure. Besides the owners, who are shareholders or stockholders, there will be Board
of Directors elected by the owners.
The Board of Directors, in turn, will elect the officers. And the Board of Directors is responsible for managing and exerc