A 2 Z FILINGS

GENERAL INFORMATION

A corporation is a legal personality, usually used to conduct business. Corporations exist as a product of corporate law, and their rules balance the interests of the shareholders that invest their capital and the employees who contribute their labor. People work together in corporations to produce. In modern times, corporations have become an increasingly dominant part of economic life. People rely on corporations for employment, for their goods and services, for the value of the pensions, for economic growth and social development.

BENEFITS

Asset Protection

If you operate as a sole proprietor or partnership, there is virtually unlimited personal liability for business debts or lawsuits. In other words should you go out of business or be a defendant in a lawsuit, your personal assets such as homes, jewelry, vehicles, savings, etc. are up for grabs. This is generally NOT the case when you incorporate. When you incorporate you are only responsible for your investment in the corporation. The limited liability feature of a corporation, while not a guarantee, is DEFINITELY one of the most attractive reasons for incorporating.

Easier To Sell

Corporations are generally much easier to sell and are usually more attractive to buyers than either a sole proprietorship or partnership. The reason for this is because a new buyer will not be personally liable for any wrongdoings on the part of the previous owners. If someone buys a sole proprietorship, for example, the new owner can be held personally liable for any mistakes or illegalities on the part of the prior owner…even if the new owner had NOTHING to do with the situation! This is usually NOT the case with a corporation.

Tax Savings

When you incorporate there are numerous tax advantages at your disposal that are virtually impossible to accomplish with other business entities. When you incorporate you create a separate and distinct legal entity. Because of this, there are many transactions that you can structure between you and your corporation to save big money on taxes. For instance, if you own a building you can rent office facilities to your corporation and claim depreciation and other deductions for it. Your corporation can then claim the rental expense. You are prohibited from doing this if you are a sole proprietor or a partner in a partnership.

Privacy And Confidentiality

The corporate form of business is a great way to keep your identity and business affairs private and confidential. If you want to start a business, but would like to remain anonymous, a corporation is the best way to accomplish this. States such as Nevada offer even more privacy protection for corporations and their shareholders.

Easier To Raise Capital

When you're looking to raise money through investment or borrowing, a corporation can actually make finding and getting the money you need easier. If you want to take on investors you simply sell shares of stock. If you want to borrow, a corporation can add clout when dealing with banks or other lending institutions.

Perpetuity

When you incorporate you create a separate and distinct legal entity. This separate and distinct entity (the corporation) can endure almost forever irrespective of what happens to the shareholders, directors, or officers. This is NOT the case with sole proprietorships, partnerships or even limited liability companies. For example, if an owner, partner, or member dies the business AUTOMATICALLY ends or gets wrapped up in legal red tape. Corporations, on the other hand, have unlimited life.

Increases Credibility

Let's face it. Most people feel more secure and confident dealing with a corporation as opposed to a sole proprietorship. Having INC. or CORP. after your company's name adds a touch of professionalism and credibility to your business dealings.

DRAWBACKS

The first chief drawback is the money it costs to incorporate. Fee's can get expensive for a corporation and include:

• Tax prepayment for first year franchises

• Government filing costs

• Filing your Articles of Incorporation through the Secretary of State

• On occasion hiring an attorney might be beneficial for the initial start up of your corporation

When owning a C Corporation there is also the disadvantage of double taxation. Again this is the idea that the corporation is taxed for profits made and you are personally taxed for profits paid to you by the corporation. However, this is avoided through utilization of an S Corporation or LLC.

Another huge weakness that comes with a corporation is the extensive reports and paperwork in general that must be done constantly. Records of every move must be kept vigilantly, and such things as tax returns filed efficiently and on time. Paperwork can become costly as people must be hired to keep track of records, organize, and file on time.

The rules and regulations that come with forming a corporation must be abided by as well, or the benefits will be revoked. Policy regarding corporations is extensive and must be paid respect. Therefore it can be somewhat of a drawback if guidelines are not followed strictly.

PRICE LIST

Prices are included with the State fees.

Corporation: $285.00

WE ARE A DOCUMENT FILING SERVICE AND DO NOT GIVE LEGAL OR TAX ADVICE