To Incorporate or Not To Incorporate
…that is the question.
If you are making a certain amount of money in your own small business (and yes, this includes income from blogging), you may be better off when it comes to tax time if you incorporate a business. There are various financial benefits to working for said business over instead of just filing as self-employed. There are write-off and deductions that are easier to organize and justify if they come under the umbrella of an incorporated business.
The Benefits
You can shelter yourself from 100% liability in the case of debt or other major problems in the business. And, you can allow your children to enjoy the benefits of an incorporated business, because unlike you, a business has an unlimited lifespan. Ownership can change hands without a flurry of paperwork and death taxes involved. Best of all, you may be able to take advantage of the small business deduction.
The Downside
On the other hand, there are the paperwork and business expenses to take into consideration. These might be minimal in comparison to your business earnings, though. And, as a sole proprietor, you may be able to claim tax credits a corporation could not. You just have to weight the options.
How to Begin
Now, there is no way for me to give you a blanket statement about HOW to go about incorporating your business. Why? The rules vary from state to state and sometimes on an even more local level. One option would be to talk to a local accountant or small business expert in your area. Or, you can go to IncParadise.com. They have an expansive FAQ section that covers the gambit. And whether you want to start a Florida, Texas, or California corporation, they charge only $89 plus state fees to do all of the paperwork to start a corporation in any state.
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