How to Incorporate a Small Business
The Benefits of Incorporating
Choosing to incorporate your small business means more than just getting an INC after your business name. You may have noticed that many small business owners opt for an LLC, or limited liability company. Just like an INC, having an LLC protects your personal assets from being liable for your business financials. However, choosing to incorporate provides benefits that extend beyond the advantages of an LLC, especially if you choose an S Corporation. Incorporation gives business owners key advantages when building a large, multinational company. If you’re looking to attract outside investors, go public with an IPO or be recognized internationally, you’re going to need to incorporate.
Steps to Incorporate
To incorporate a small business in Florida, you first need to choose a name for your organization that abides by the rules of your state. Next, you’ll file several documents with the State Department and hold a formal meeting to write your organization’s bylaws. For tax purposes, request a Federal Employer Identification Number (FEIN) from the IRS. Your corporation will need its own bank account, so you’ll have to open a separate account in your business name. Finally, obtain all the required licenses from the city, county and state where your business is based. If you are incorporating a nonprofit organization, there are some additional steps to take. These include things like creating a Statement of Purpose and filing for tax exempt status with the IRS.
S Corp Versus C Corp
Within 75 days of forming your corporation, you’ll need to file Form 2553 to elect Sub Chapter S Corporation status with the IRS if you so choose. By default, a Corporation is born as a C Corporation and business income is taxed at the corporate level, but an S Corp is considered a “pass-through entity.” This means the owner reports and pays business income taxes as part of their personal taxes at their bracket level. With an S Election, your business is limited to no more than 100 shareholders. All shareholders must be U.S. citizens or resident aliens or certain trusts and estates. S Corporation status allows your business to avoid the double-taxation pitfall of the C Corporation structure. For all the latest business laws and tax benefits, let the professionals at Alron Corps, Inc. guide you through an efficient and seamless process to incorporation.
Work with our Small Business Specialists
Running your own business isn’t easy, and it certainly takes time, determination, and lots of hard work, however with the right tools and knowledge, it can be a lot easier. Alron Corps, Inc., a subsidiary of Alron Enterprises, Inc. specializes in providing small businesses the highest quality expert assistance. Contact us today to get started! We look forwarding to hearing from you. Give us a call: 321-951-7626 or send us an email: [email protected]