Business is to earn profit. To earn profits you have to assume risks. These are the two basic tenets of business-for-profit. As man is wont to, we innovate and form new practices. Now it is possible to do business with limited risks. Limited Liability for business owners in their business obligation is a legally accepted fact. Corporations and Limited Liability Companies are taken for granted in the ordinary course of life. These business structures are meant for operating considerable business with limited liability to the business owners. Limited Liability Company is an advanced form of a general partnership. The only difference is that the partners or members as they are termed in an LLC, have limited personal liability towards the business debts or obligations. This does not mean that by forming an LLC or a Corporation one is scot free to do anything they wish. Criminal acts or wilful negligence is still punishable under the law.
Corporations have become the most common legal business structure for budding entrepreneurs with a vision to grow. Small business incorporation is now easy with states encouraging small business operators. States are actively soliciting entrepreneurs to start business in their territory by simplifying formation procedures and formalities. Some states even provide tax holidays or subsidies for niche businesses. To know how to incorporate yourself, all you need to do is get in touch with the agency handling business registrations in your state. Usually this is handled by the Secretary of the state’s or Corporations Commissioners offices.
There are a few basic rules on how to form a corporation. First step is to find a name for you to incorporate under. Care is needed in doing this. You cannot use a name which is identical or closely similar to that of any existing business. You will have to check with the agency handling corporations in your state and the corporations register to make sure that the name chosen is available for use. Then you file an Articles of Incorporation paying the due fees. The Article is usually a pre-printed form which should be filled in and signed by the incorporator or the promoter of the business. It will contain the basic information about the corporation and its functions. A bylaw of the corporation to set the rules and policies for the operation of business is a necessity. It will act as a guide to the directors and office holders of the corporation in executing their duties and handling their responsibilities.
