Tips & Traps When Incorporating Your Business

by Jensen, Jeffery; Radford, Brian; Bulpitt, Stephen

• ISBN13: 9780071457866
• ISBN10: 0071457860
• Edition: 1st
• Format: Paperback
• Copyright: 2005-09-20
• Publisher: McGraw-Hill Education

Summary

Tactics for small business owners to incorporate on their own and reap big rewardsTips & Traps When Incorporating Your Businessis for millions of small business owners who want to incorporate their businesses but are intimidated by the legal complexities and fees associated with the process. The authors clearly describe the types of corporations and explain the legal and tax advantages of each. Then, following the acclaimed Tips &Traps format, they: Walk readers step-by-step through the process--from picking a name to filing paperwork, issuing shares, and running shareholder meetings Supply samples of all the necessary forms, agreements, and other documents Provide checklists covering legal, financial, and tax-related aspects of incorporating Explain the different types of corporations and their key characteristics (including owner liability, tax treatment, documents needed, and management styles) Explore the right locations to incorporate a particular business, and how to raise capital for that corporation

Author Biography

Jeffery A. Jensen, C.P.A. and Brian Radford are the founders of American Business Solutions, Inc., a small-business consulting firm.

Stephen Bulpitt is the founder of United Financial Solutions, an e-publishing and small-business consulting firm.

Table of Contents

Introduction	p. 1
What Is a Corporation?	p. 2
Why Should I Incorporate?	p. 4
For-Profit versus Nonprofit Corporations	p. 8
Choosing Which Business Entity Is Best for You	p. 11
Sole Proprietorship	p. 12
General Partnership	p. 13
Limited Partnership	p. 14
Limited Liability Company	p. 15
C Corporations	p. 15
S Corporations	p. 16
Comparison of Business Entities	p. 18
Incorporating	p. 23
Checklist for Incorporating	p. 23
Choose a Corporate Name	p. 24
Choose a Business Type	p. 26
Choose a State in Which to Incorporate	p. 26
Key Documents for Incorporating	p. 29
Determine Stock Composition	p. 29
Choose Corporate Directors	p. 31
Choose a Registered Agent	p. 31
Prepare Your Articles of Incorporation	p. 32
Prepare Other Key Documents	p. 33
File Key Documents	p. 35
Federal Employer Identification Number	p. 35
Shareholders Agreement	p. 36
Organizational Meeting	p. 36
Open a Bank Account	p. 36
File Form 2553 for an S Corporation	p. 37
Organize Corporate Records	p. 37
You're Ready to Operate Your Corporation	p. 37
Running Your Corporation	p. 39
Role of Directors and Officers	p. 39
Role of Bylaws and Corporate Minutes	p. 41
How to Run Your Corporation	p. 44
Hold Corporate Meetings	p. 46
Special Issues for One-Person Corporations	p. 48
Learning Basic Accounting and Finance	p. 49
Financial Statements	p. 49
Ratio Analysis	p. 53
Managing Your Business	p. 59
Accounting Systems	p. 59
Basics of the Double Entry System	p. 60
Why Keep Records?	p. 60
A Business Checkbook	p. 64
Getting Help from an Accountant	p. 65
Filing Taxes	p. 67
Accounting Year	p. 67
Accounting Method	p. 68
Tax Professionals	p. 69
Forms to File	p. 70
Minimizing Taxes	p. 77
What Is Deductible?	p. 77
Liability	p. 87
Preventing the Corporate Veil from Being Pierced	p. 87
Alternatives to Lawsuits	p. 89
How to Find a Good Lawyer	p. 91
Raising Capital	p. 95
State and Federal Money	p. 96
Funding through Loans	p. 97
Funding through Venture Capital	p. 100
Creative Alternatives	p. 102
Summary	p. 104
Managing Employees	p. 105
Planning for Employees	p. 105
Where Can I Look for Employees?	p. 108
Other Hiring Considerations	p. 111
Offering Benefits to Your Employees	p. 113
Health Insurance	p. 113
401(k) Retirement Plans	p. 114
IRA Retirement Plans	p. 116
Fringe Benefits	p. 117
Exit Strategy	p. 118
Labor and Employment Law	p. 119
Title VII	p. 120
Equal Pay in Employment Act	p. 122
Age Discrimination in Employment Act	p. 123
Title I and V of the Americans with Disabilities Act	p. 123
Sections 501 and 505 of the Rehabilitation Act of 1973	p. 124
Civil Rights Act of 1991	p. 124
Other Important Laws and Acts	p. 124
Summary	p. 126
State Specific Information	p. 127
Articles of Incorporation	p. 189
IRS Form SS-4 and Instructions	p. 199
IRS Form 2553 and Instructions (S Corporation Election)	p. 209
Bylaws Template	p. 217
Minutes of Annual Meeting of Shareholders	p. 227
Minutes of Annual Meeting of Board of Directors	p. 231
Sample Business Plan	p. 233
Index	p. 237
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