I wanted to remind you that incorporation only protects your name in the state of incorporation, and you will have no protection in NC if you choose to incorporate in Delaware. I ran up against that one personally and consulted with lawyers specializing in trademarks and copyrights on the matter. Another company incorporated in another state with essentially the same name. If you create and register a trademark or servicemark, then you might have protection, but I would definitely consult an attorney about it. Also you will need to be prepared to defend it.
As for taxes, the main advantage is that the IRS does not question your deductions as much as for a sole proprietarship, so long as the books are properly kept. In most cases, the taxes characteristics of an S Corp, partnership, LLC or sole proprietarship are very similar. In all of these cases, unlike the standard tax treatment for corporations, you avoid double taxation of the earnings. As you know, normally a corporation pays taxes and then the owners pay taxes on the dividends. S-corp allows the earnings to flow to the owner every year which is both good and bad, depending on your tax situation. Unfortunately the IRS also make S-corps (and the others) treat benefits for anyone with over 2% ownership. For example, health insurance for them is not deductible. Those individuals must take a deduction on their personal taxes, which is still only 70%. Fortunately you do not pay social security on these amounts. One possibility would be to have your spouse own the corp but that is another question. Ray -----Original Message----- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On Behalf Of Greg Jones Sent: Sunday, February 01, 2004 12:39 PM To: [EMAIL PROTECTED] Subject: Re: [Juglist] launching a website Adding to the great responses: I'm assuming your going to sell something (products or services): The liability issue is a very important reason. TAXES,TAXES,TAXES is my main reason why I create my efforts under a company name. It helps me ensure: - that selling services/products can be sold inside the Raleigh city limits, North Carolina, USA - that my products/services have a common parent name and that name can be trademarked/servicemarked - I can have many tax write-offs related to my efforts (i.e. Computers, cell phones, gas, my labor) Trademark (TM) / Servicemark (SM) is supported by the Federal Government. If you don't want anyone else to have the same name / logo that your company has. ---------- Original Message ---------------------------------- From: Chris Beecher <[EMAIL PROTECTED]> Reply-To: "Research Triangle Java User's Group mailing list."<[EMAIL PROTECTED]> Date: Sun, 01 Feb 2004 10:53:32 -0500 >Ray is absolutely right in all of this but underemphasizes another >attribute of incorporation, namely that it allows one to create a >separately taxable entity. There are both benefits and obligations that >are entailed here (often quite complex), but this is probably the single >largest reason creation of a corporation where the business outcomes are >vague. > >Ray Hooker wrote: > >>Let me expand on the issue of trademarks and copyrights. If you >>incorporate, you only protect your corporate name in the state you >>incorporate. So someone can incorporate in another state and you >>can't stop them.. Unless they try to business in the state you >>incorporate. That is something to consider for those who incorporate >>in another state. >> >>A trademark could be protected if you came up with some special logo >>or something. >> >>The reasons that you incorporate (or create an LLC) are: >>- Limited liability. Not a big deal for a sole practitioner but it >>helps. You will may need to get a liability policy if you do much >>contract work. >>- Protects your clients from the IRS going after them for taxes and >>preserves your contractor status. Basically you become an employee of your >>company and do withholding appropriately. >>- Allows you to offer benefits and acquire group health plans. Note that >>you cannot offer cafeteria plans (various benefits paid out of pretax) until >>you have several years under your belt and add other employees. >>- Note that I found that being incorporated with a liability policy allowed >>me to do business with a wide variety of clients. >> >>You don't need a company for copyright issues. An individual can have >>a copyright issued to them. >> >>The real question is what you are trying to accomplish? Are you >>trying to protect your business name, intellectual assets or simply >>trying to do business. >> >>Ray >> >>-----Original Message----- >>From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] >>On Behalf Of Adam Kuehn >>Sent: Friday, January 30, 2004 6:16 PM >>To: Research Triangle Java User's Group mailing list. >>Subject: Re: [Juglist] launching a website >> >> >>[EMAIL PROTECTED] wrote: >> >> >>>Anyone with an experience in launching a website under new company >>>banner? >>> >>>I am planning on launching a website and was wondering if I will have >>>to start my own company for the copyright issues, etc. >>> >>> >> >>It would help if you let us know more about what you are trying to do >>and what your concerns are. Launching a website by itself, of >>course, doesn't require starting a company at all - not even if you >>are selling a product. You can 'start your own company' simply by >>selling stuff. There is no requirement to do anything at all if you >>just want to begin a sole proprietorship. However, if you are >>selling products or services that could potentially subject you to >>substantial liability, then you may want to form an LLC or >>incorporate in order to limit the claims that can be made against you >>personally. >> >>Although you can form an LLC or corporation yourself, I wouldn't >>without doing some serious reading first and then at least consulting >>with an attorney. It will cost you a few hundred bucks, but if you >>are wanting limitations on personal liability, presumably you have >>assets worth more than that that you wish to protect. Best to do >>your legwork and then hire a pro to get it right. >> >>On the other hand, you mention copyright as a concern. You don't >>need to do anything special to claim a copyright or common law >>trademark in your own works, either. So if claiming your own >>copyright or trademark is your primary concern, you may be able to >>get by with being a sole proprietorship. On the other hand, if you >>are worried that you might be infringing on someone else's copyright, >>trademark, or patent, then again the liability question is relevant >>and you may need to consider the LLC or corporation. >> >>What's right for you depends mostly on what it is that *you* need. >>Different forms of business exist because different things are >>appropriate for different circumstances. >> >>Seems like a non-answer, but really more information is needed before >>intelligent help could be provided. I'd be happy to follow up with >>you off list if you need. And no, I'm not an attorney. >> >> >> > > > > > _______________________________________________ Juglist mailing list [EMAIL PROTECTED] http://trijug.org/mailman/listinfo/juglist_trijug.org _______________________________________________ Juglist mailing list [EMAIL PROTECTED] http://trijug.org/mailman/listinfo/juglist_trijug.org
