How to Form an LLC or Corporation in DE or FL
By: Chris Einkauf | Posted: 22nd August 2006
-- This article deals with the process of forming a company, whether it be an L.L.C. (Limited Liability Company), or Corporation (for-profit or not-for-profit). Specifically, the author explains his thoughts on how to form an llc or corporation. For questions or comments, see the contact information provided. --
To form an LLC or Corporation in Delaware (DE) or Florida (FL), the thing you need to first determine is: how soon do you want to be protected? The company only protects you from the time it is filed. The longer you wait, the more susceptible you will become to actions that may accrue against you before the liability shield of your company is established. Simply put, the sooner you act, the sooner you are protected. The single biggest mistake business promoters make when choosing an entity is waiting to act. Whether the company is a consulting business or retail business, either the LLC or Corporation should suffice and the LLC is the no-brainer. Modernly, the choice of entity is reversible later through a conversion whereby an LLC can become a corporation and visa versa. Also, the IRS has recently ruled that LLC's are entitled to the same tax elections as corporations. Now you may have an LLC and file a Form 2553 to be taxed as an S-Corporation, so you may now have your cake and eat it too. The LLC offers asset protection and the most flexibility in management with the fewest compliance requirements to maintain the liability veil. It is easy to miss this big picture with all of the information and mixed messages on the internet. It is a good idea to be comfortable with the agency with whom you choose to file your business. Bigger is rarely always better. You should do your homework and find a business that provides a reliable service at a reasonable price. Often firms run by seasoned attorneys are more reliable.
To start your search for companies, I suggest you first scan the field.
Gathering Knowledge:
The first category that must be mastered is very self-explanatory, yet very troublesome at times. For those that have not yet formed any businesses (the majority of people), there seems to be nowhere to start. But alas, you have found this article so you have, in fact, used some sort of knowledge-gathering tool. This tool, the internet, is quite possibly the greatest source of knowledge that will ever be invented. Search engines such as Google and Yahoo can deliver more information than you ever thought possible. Almost any question you may ever have about anything in the world is located somewhere online. You just need to know where to look. Here are a few tips for finding what you are looking for with search engines such as Google: Search Engine Tips. Once you have mastered the art of googling, you will need to know where else to look. Another great tool is .gov websites (such as de.gov – the Official State of Delaware's website). On these websites, not only will you find great sources for corporate entity information, but you will also find contact information for government information, from which you will certainly obtain un-biased information about any of your business questions. The last tidbit about knowledge-gathering that this author is compelled to divulge is simple – always get a second opinion, since truth and sincerity are hard to come by. For example, do not trust the registered agent that tells you they are simply the best because they are the best – get facts, get number, get comparisons, and then get them from someone else and compare prices.
Turning knowledge into action:
The second category of successful business formation is turning that knowledge into action. This category includes picking the state that is best for you, the entity type that is best for you, and finally the agent and package that are best for you. Since this step is usually opinion-based, there is not much advice that can be given about which types of formations are best for your own business. You will simply have to rely on all the information you gathered, and judge it all based on your business goals. Just know that the LLC is usually the best choice and that the US Chamber of Commerce has rated Delaware number one for the past six years consecutively. When it comes to choice of entity the biggest mistake you can make, is making no choice at all. You really cannot go wrong with a Delaware LLC. (If you still are unsure of which agent to begin your search with, a recommended agent would be Agents and Corporations, Inc. which specializes in incorporating in Delaware and incorporating in Florida).
This article is free for republishing
Printed From: http://www.articlealley.com/article_83982_18.html
Back to the original article
Tags: brainer, homework, big picture, irs, retail business, corporations, limited liability company, s corporation, mixed messages, consulting business, veil, article deals, asset protection, reliable service, compliance requirements, mast