If you are starting a small business or you are thinking of incorporating your existing business or forming an LLC, you may have seen banners and advertising for online incorporation services. And if you have, you’ve probably wondered how good these services are. Can incorporating online save you attorney fees? If you set up a corporation through an online service, will it be legal in your state? Could you save even more by buying a book about how to form a corporation or LLC and doing everything yourself instead of using an online incorporation service?
The question of when to hire an attorney or tax professional to set up your corporation, and when to do it yourself is complex. But as a general rule of thumb, it’s wise to form relationships with local professionals and get their advice on steps you need to take iniitally and ongoing. But in most cases you’ll need to pay a fairly substatial hourly rate for their services.
You could save money by researching your need and filing all the paper work yourself, but unless you have a legal background, you’re likely to spend considerable time trying to learn what to do, and still may not get everything right.
The third alternative is to use an online incorporation service. The benefit of the online incorporation service is that they usually cost less than hiring your own attorney, and provide you with the peace of mind of knowing your documets have been properly completed and filed with the appropriate authorities.
Whether you incorporate yourself , use an online incorporation service, or your own personal attorney, you should also consult with a CPA to be sure you understand the tax implications of incorporation and what you’ll be required to file, when. For example, you’ll most likely become an employee of your corporation, and will then be required to collect and pay payroll tax on the salary you pay yourself.