Choosing the Right Business Type

Choosing the right business type is the hardest part of most business owner’s incorporation process. That said, if choosing the type is the hardest part – then incorporating is not that difficult and you can get through it in the next 20 minutes if you choose.

The easiest way to choose which type of corporation is to view this chart at one of our partner sites:

Incorporation Types Chart >

Once you’ve done that you should have a real clear picture about what type of corporation you should choose. If not, read on…

If you need to have a business where donators can have tax benefits then you need a nonprofit corporation and you’ll need to apply to the IRS for tax exempt status – it’s not automatic.

If you want to avoid double taxation of a regular profit corporation you’ll want to choose either the LLC or Subchapter S (S-Corp) types.

If you will hire a lot of employees in the future you probably want a Subchapter S (S-Corp).

If you will run the business yourself or with only a couple employees then a LLC is probably your best bet.

If you are still unsure which type of corporation is best for you we recommend going the IRS site and reading about various corporation types. We also suggest talking to an accountant about which might be right for you if you can’t choose on your own. Please be aware that you should set a time for the accountant and agree on a price to talk for 15 minutes or half hour. Accountants like to try to force you into incorporating your business through them for a large sum of money. Fact is – you can incorporate yourself here when you return from your meeting and save a whole lot of money doing so.

If you have questions we can answer – please write or call using the contact information on the right side column.

Best Regards,

Dean Harrington, Owner