There are many things that you have to take into consideration when starting a business in Indiana. The first one is whether to incorporate your Indiana small business or not.
While you can definitely operate your Indiana startup without having it incorporated, this would pose potential problems in the future. Before you make a decision, let’s first define what incorporation is.
Incorporation is a legal process that enables you to structure your business as an entity. The first step of the process is to choose the form of business entity that you want to establish.
Sole Proprietorship, Corporation and Limited Liability Company (LLC) are a few examples. Whichever entity you choose will determine the income tax return that you have to file before the state of Indiana.
Although many entrepreneurs have varying perspectives when it comes to incorporation, the legal process will undeniably protect you, your business, as well as your consumers. If you want to know if incorporation is right for your Indiana small business or not, here are 5 solid reasons to convince you!
Quick Note: If you decide to incorporate in Indiana 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.
No matter how similar you and your co-owners or co-founders are, the risk of conflicts as you run your Indiana startup will still be highly possible. Misunderstandings, either brought about by personal or business factors can cause negative effects on the business, especially in its operations.
If you incorporate your business, you’ll be able to issue different kinds of stock when worst comes to worst happens. Equal sharing of stocks is very important; every shareholder should be distributed with the same amount of shares. Although this might not help alleviate the problem, it will definitely ensure that you have fair sharing.
Since your Indiana small business is an inanimate object, it can easily outlive its founders. If you want your business to continue operating even when you’re gone or there are changes in management structure and ownership, you have to incorporate it.
If any shareholder passes away or transfers, withdraws or sells their shares of stock to another person, the state will still allow your business to continue operating; establishing perpetual existence.
When you incorporate, the state recognizes your Indiana small business as an independent entity. It will have its own rights and will be able to initiate its own transactions. Since it now becomes an independent entity, you will no longer be held accountable for its mistakes and debts.
Creditors will not be able to file a case against you even if you’re the owner and shareholders will not lose their investments. However, if a shareholder holds a position within the company, say for instance, the position of director, he/she may be held liable.
Financing your Indiana startup will prove to be one of the most challenging tasks of building a business. If you want to look for funding the easy way, you have to incorporate your business so you can form an entity. Investors will never attempt to invest in a venture which is not incorporated because unincorporated businesses don’t have the ability to issue stocks.
Corporate identity is an important part of doing business. For customers to identify and remember your business, you need to build your corporate identity. One of the first steps that will enable you to do this is to incorporate your business.
Whether you incorporate your business as a corporation, LLC, partnership, sole proprietorship and s-corporation, the most important thing is, people will know that you’ve legally registered your business within the state and you’ll be able to gain their confidence.
Incorporating your Indiana small business can be quite difficult, especially if you’re a first time business owner. You may need to seek assistance to go through the legal process smoothly.
You have two options: hire a professional or use an online incorporation service. Regardless if you’re planning to form an Indiana LLC or Corporation, an online incorporation service can help you.
If you search online, there are numerous online incorporation providers that you can choose from. The challenge is to choose the best one for your business! You may have heard of LegalZoom, however, there are many other incorporation services that will be able to assist you. Here are three of them!
IncFile is one of the top online incorporation services in the industry. It offers clients affordability and quality services, assisting you fully during the incorporation process.
For an affordable price of $49, you can use the following features: free registered agent service for one full year, one-business day preparation, order tracking in real time and one-on-one business consultations.
You can read the review for more info!
Another excellent provider that you can choose is CorpNet. The online incorporation service, with its mid-priced packages is one of the most used providers in the market. It not only provides a cheaper way to incorporate your Indiana small business, it also has one of the best services.
If you use CorpNet, you can use the following services: a Business Structure Wizard, free business consultations, free trademark search, free business name search and 24-hour document preparation. You can read the review for more info!
Although BizFilings is a bit expensive compared to its counterparts, the online incorporation service is still one of the most sought-after. With an A+ BBB rating on its belt, BizFilings is considered one of the most trusted incorporation providers among entrepreneurs.
Take advantage of BizFilings’ excellent features such as its one-day business preparation and filing, business name verification, registered agent service and a lot more. You can read the review for more info!
While these three have more or less the same features, they actually have major differences. For example, IncFile provides a free registered agent for one full year; BizFilings also has this service, however, it only offers the service for free for 6 months, after that, you need to pay for it.
BizFilings on the other hand has the BizComply, which is a compliance tool that IncFile lacks. These are just some of the major differences between these online incorporation services.
Responsible business ownership is a term that most entrepreneurs neglect. When starting a business, you shouldn’t only think about safeguarding your startup alone, you should think of yourself, as well as protecting your consumers, making sure that you look after their rights. The only way that you can do all three is if you incorporate before the state of Indiana.
These are just suggestions, but at the end of the day, it’s up to you to decide. Make sure that you are fully convinced of the reasons why you need to incorporate. If you choose to go through the process, educate yourself on the different business entities before choosing one.
You also have to look into your business needs, tax obligations, risk liabilities and even your business objectives. Make the right decision, incorporate your Indiana small business!