Starting a business in Connecticut is a pretty serious thing; you need to dedicate time, effort and resources if you want to start on the right foot.
If you’re not the “patient” type of person, you have to get ready because you need to extend your patience almost all the time. It’s a long and tough process, definitely not for the faint of heart.
In this article, we’re going to discuss one of the most important steps in the startup process – incorporation. By now, you have to know the basic meaning of this term and why you need to incorporate.
However, if you’re not fully convinced that this process is necessary, read this list which contains 5 solid reasons why you need to incorporate in Connecticut. After that, I’m going to introduce you to the top 3 resources for incorporating a business in Connecticut.
Quick Note: If you decide to incorporate in Connecticut and want professionals to handle all legal paperwork, look into IncFile (for $49) or LegalZoom (for $149). Both are excellent services and have started over 50,000 businesses like yours.
Multi-owned companies are always at risk than those who are owned by a single person. Imagine a group of people with different personalities, attitudes and traits – living in one roof – it’s inevitable, conflict and tension will sooner or later arise.
Managing a business is not easy, aside from power struggle, differences will always stem from how equity is split. If you incorporate your Connecticut business, you will be able to equally issue stocks to founders preventing misunderstandings.
If your business is under sole proprietorship or general partnership, it is not considered a separate entity, therefore, any loans or lines of credit is directly connected to you on a personal level. Just think, what will become of you if creditors seek for repercussions? It will be your responsibility to compensate them.
An important reason why you need to incorporate is for your own safety and protection. Once you decide to incorporate, you will be free from any legal, financial and personal liability. Any issue or problem your business encounters in the future will not be your responsibility. This means that your assets and savings will not be at risk in any way.
Before a third party investor can invest in your business venture, there needs to a formed entity to do so. Once you have an entity in place, you will be able to accept any investments made. Venture capitalists also prefer businesses who are incorporate because they can issue different types of stock.
There are still many benefits of a formal business structure even if you’re not looking for funding. Those doing business under partnership or sole proprietorship are required to sign contracts with the use of their own names, which simply means that any credit line or loans will be placed directly under you. However, once you start an LLC or Corporation, your business starts its own credit profile.
Perpetual Existence in the simplest definition, is a process where you ensure the lifetime existence of your Connecticut business. How do you do this when you incorporate?
Legally registering your business before the state will give it full protection so that when unexpected situations occur like the death of one owner, the transfer or selling of stocks, your business will remain strong and standing.
Such situations will not easily rock your business and you’ll be able to continue operating as if nothing happened. This is what you call perpetual existence.
Many business owners attest that after incorporating their business, they’ve seen an increase in sales and overall profit. Having an LLC or Inc. after your business name gives you that added boost of credibility, which attracts customers.
Also, there are certain industries that require a legal business structure before you can be given a work contract. Many large companies prefer to work with incorporated businesses than those who are operated under sole proprietorship.
Incorporating a business in Connecticut is a complicated process. It may need some research and studying on your part so you’ll understand the process better.
It doesn’t matter if you want to start an LLC or a Corporation, there are so many available resources that can help you as you go through with every step.
However, if you don’t have the luxury of time to work on the process yourself, or you’re not so confident that you can do it with efficiency, it’s better if you hire the services of an online incorporation provider. Trust me, I’ve used one and it’s been very helpful!
One of the more popular incorporation service is LegalZoom and I’m sure you’ve heard of the provider, but there are many more options available, they include the following:
IncFile is one of the best in the industry. Known for its super affordable plan prices and quality services that include features such as a free Registered Agent for up to one year, 1-on-1 business tax consultation, one-day document filing and order tracking in real time, the process of incorporating your Connecticut small business is easy.You can read the review for more info!
With an A+ BBB rating since 2009, CorpNet has proven its place in the online incorporation industry. Founded by a husband-wife team of entrepreneurs from Southern California, it is a relatively new company that genuinely understands and assists small business owners to kickstart their business. You can read the review for more info!
BizFilings has over a decade of experience in helping Connecticut businesses jumpstart the incorporation process. It has the BizComply, a 24/7 business monitoring tool and document library, free business name verifications, a registered agent services and a 24 hour document preparation and filing. Checkout BizFilings, read the review for more info!
Online incorporation services differ when it comes to their features. One feature may be offered by a particular incorporation service, while it may not be present in others. For instance, IncFile has a free registered agent service for one year which is valued at $150 and while CorpNet and BizFilings have the same services, you need to pay for them. CorpNet on the other hand has free trademark search that IncFile doesn’t have.
These are just a few examples of their differences, however, these top 3 resources are the best in the industry and I assure you, you’ll get more than what you pay for! At the end of the day, you have to look into these three resources and decide which one is the best for you.
Connecticut is a lovely place, and although it’s economy slowed down quite a bit in the past years, it has been slowly picking up its pace today.
With the market competition getting tougher and tougher by the minute, you have to do everything to maintain and establish the state of your business – you need to start by incorporating. This is the only way to survive in the Connecticut market.
However, there’s one question that you need to answer, will you use an online incorporation service to do the job for you or not? It’s up to you, I expect that you’ll do the right thing. Protect you and your new business from liabilities once and for all!