Page 123 - Winning The Credit Game Bundle (CK Patrick)

some legal protections to their operators and are
eligible for Employer Identification Numbers, business
bank accounts, business credit, and all the general
perks and privileges of a corporation.
Unlike other corporation types, LLCs generally do not
require a board of directors or have strict rules about
corporate proceedings.
S-Corporation. S-Corporations offer certain benefits,
such as tax advantages and the ability of the company
to sell stock shares to investors. However, S-Corps are
subject to stricter rules and regulations than LLCs and
can only have up to 100 shareholders.
C-Corporation. C-Corporations may be of unlimited
size and have an unlimited number of shareholders.
They are also subject to stricter oversight rules for this
very reason. This is the preferred business structure
for business owners who wish their company to go
public on the stock market one day, but if that is not
part of your business structure, it may be easier to
avoid the added rules and regulations with an LLC or
S-Corp.

Once you have decided which type of legal entity to create
for your business, you will need to file paperwork with a state
government to incorporate your new business entity.
Typically, this will be your own state. Most states require
corporations to be incorporated and pay taxes at least in the state
in which they operate, so in most cases incorporating in your
own state is the safest and simplest thing to do.
You may have heard of some states incorporating in other
states. California, for example, imposes an $800 tax on all busi-
nesses, regardless of their size or income, so some businesses
look for ways to incorporate in other states. Delaware, by
contrast, has a dedicated business court which is renowned for
its speed and efficiency in deciding legal matters, so many
corporations seek to incorporate in Delaware so that they can

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