Owning a business in Claremont, California, is exciting and gives a sense of fulfillment, but you need to contend with the numerous risks inherent in the business environment. While running a business is risky, one way to minimize your personal liability is incorporating your business with the help of Whyte & Associates, Inc. Whether you are thinking of a business idea or already have a sole proprietorship or partnership running, here are the benefits of incorporating your business in California:
- To protect your assets: A corporation can own assets, incur liabilities, and sue or be sued. You and your organization are two different entities. Do you know what this means? As a separate entity, your incorporated business is responsible for its debts. In the case of solvency, creditors seek payment from the company and not from you, the shareholders, or the directors. That gives the owners the freedom to run businesses without putting their homes, vehicles, savings, and other personal assets at stake.
- Easy access to capital: A sole proprietorship or partnership cannot raise capital by issuing shares of stock. However, this is never a limitation of an incorporated business because the company can sell part of its stake to shareholders to raise funds. Additionally, banks and investors will likely lend money to corporations in favor of unincorporated businesses.
- Enhanced credibility: Beyond financiers, customers and suppliers alike are likely to build confidence in an incorporated business, as they perceive it to be more stable and credible. Think of it this way. Don’t they communicate credibility, stability, and permanence when you see the words “Inc.” or “Corp” after a business name? Clients and stakeholders think the same when transacting with your incorporated business.
- Tax benefits: Incorporated businesses can deduct start-up costs, insurance, employee costs, and other expenses to reduce the tax burden. Low tax payments translate to better cash flows to grow your business.
While incorporating your business demands more paperwork than a sole proprietorship or partnership, it yields numerous tax and legal benefits. In addition, the good thing is that you do not have to undergo the hassle of incorporating your business personally. If you are in Claremont, CA, and its environs, please dial (909) 575-0080 to contact Mr. Steve Whyte for personalized business incorporation services.
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