Choosing the right entity type for what you are doing is very important. You need to be well informed before you choose the entity that will work best for you. All entities are taxed differently. Two important things to look at are the ownership and the type of products or services you are providing.
2. What are the benefits of incorporating?
Incorporation will provide you with personal protection through the Corporate Veil. This means that if an unsatisfied customer wants to sue for damages, they need to sue the company. Your personal property will be protected. Next is that entities are taxed differently. This means that you can use the entity type to your advantage and help you to reduce the taxes that you pay.
3. Why Incorporate in Delaware?
4. I was told that an LLC is tax-free. Is this true?
Yes, LLC's are tax-free. The profits or losses pass through to owners, so the owners will need to declare the income or loss on their personal tax returns.
5. Can I change the type of entity after it is incorporated? For instance changing from an LLC to C Corp, or the other way around.
Yes, corporation types can be changed at any time. One thing to look out for is timing some entities pay taxes for the year even if they were operating for a few months. An example is if you chose too change the entity type in January, you may need to pay the full years franchise tax on that company type, and also pay the franchise tax for the new entity type. This varies from state to state and between entity types. We help people do this all the time. That is why you need to be well informed before starting the incorporation process.
6. I want to take money out of my company, how do I pay myself?
There are a variety of ways to get money out of your company. Depending on the entity type you could, draw a salary, withdraw management fees, use reimbursable expenses, get dividends, or take an owners draw.
7. Can the non-profit make money? Can I benefit financially from my non-profit?
Yes, a non-profit company is exempt from paying income taxes, and allowed to have an income. The owners of a non-profit can not take company funds for personal use, but they can draw a salary plus benefits.
8. I am not a U.S. citizen. Can I own a company and not have a personal tax ID?
Yes
9. What are corporate records and am I required to have them?
Corporate records are the companys Bylaws or, Operating Agreement. The type of entity you have will determine if you have Bylaws or an Operating Agreement.
10. Do I need to elect a Director and Officers?
Yes, each state has different requirments. Delaware allows one individual to hold all of the offices. Other states may require separate individuals to hold each office.
11. What makes DSS Incorp different than other incorporators?