When setting up your own business, you should consider becoming a Corporation. While the steps to form a corporation may seem complicated, they are not complicated if you have a few pointers in mind. Creating a Corporation is a legal process and you need to follow certain steps in order to make your business a success. Listed below are some of the main steps in this process. If you are interested in becoming a Corporation, you should contact a lawyer for assistance.
Firstly, a corporation is a legal entity, separate from its owners. This allows it to engage in lawful business, borrow money, hire employees, and sue or be sued. Corporations generally have a board of directors and are governed by shareholders who elect the directors. If, however, one or more shareholders die, the corporation can be dissolved and its assets can be distributed to shareholders. Likewise, the corporation can continue to exist even after its members have passed away.
Another key feature of a corporation is that it provides limited liability for its shareholders. This means that if a company fails to make a profit, its stockholders are not personally liable. Unlike partnerships, a corporation can transfer ownership shares without re-organizing. Furthermore, the corporation can make contracts and hold property in common name, and the duration is generally unlimited. This is a big benefit for most small businesses. In general, corporations are easier to set up than sole proprietorships or partnerships.