One of the keys to building a strong, successful business is making sure that you have the proper legal structure in place. You need to select the best form for your particular business. Your company will not be able to grow and thrive without a great foundation.
For some Illinois companies, it makes sense to incorporate. For other companies, incorporation is not the best choice. How do you know what form is right for your business? There are certain questions that you should ask yourself that will help you give you a better idea.
In this article, our top-rated Chicago business law attorneys provide an overview of the most important things you should think about when deciding if your business should be incorporated. If you have any specific questions about your company, please contact our legal team immediately.
Thinking About Incorporating Your Business? Four Questions to Ask Yourself
Corporations and LLCs offer personal asset protection. This is in contrast to sole proprietorships and partnerships, which do not offer such liability protection. This is one of the primary reasons why businesses choose to incorporate. For certain companies, that personal liability protection is critically important.
With some exceptions, there are limits to the ultimate growth of sole proprietorships and partnerships. On the other hand, corporations can last in perpetuity. It is also much easier to sell or transfer part (or all) of the ownership of a corporation. Business owners who are seeking considerable growth should strongly consider the possibility of incorporating.
It is much easier to raise money from outside investors if you have incorporated your business. Whether you are looking for venture capital, an angel investment, or simply access to business credit, the formal structure of a corporation makes it far easier to obtain the financial investment that your company needs.
In some cases, businesses can save money by incorporating. To be clear, this is not always the case and there are some additional upfront costs associated with incorporating. However, for certain businesses, the net tax savings of incorporation are still very real. If you operate a sole proprietorship you will be required to pay the Self-Employment Tax. With a corporation, this tax burden will be replaced. Before changing your business structure for tax reasons, it is imperative that you consult with a professional tax advisor or a qualified attorney.
Get Help from a Chicago, IL Business Lawyer Today
At North Suburban Legal Services LLC, our Chicago commercial law attorneys have deep experience handling issues related to business formation. If you have questions or concerns about incorporating your business in Illinois, we can help.
For a free, fully private consultation, please do not hesitate to contact our legal team at (312) 313-4038. With an office in the heart of Chicago, we represent companies throughout the region, including in Cook County, Lake County, Will County, DuPage County, and McHenry County.