What Is the Simplest Way to Incorporate?

You know you have to incorporate. What you’re not sure is exactly how to do it without investing a great deal of time and money.

Perhaps the main advantage to incorporating is that it limits your personal liability for negligence or breach of contract. If your business is incorporated and you maintain the documentation and separation of personal and corporate finances as you should, then you may significantly reduce your personal financial risk if you are sued for breach of contract or some other liability.

Here’s what you need to know about the simplest, easiest (and cheapest) ways to incorporate your new business, from least expensive to most expensive.



The DIY Approach to Incorporation

This method has the advantage of being the least expensive, but it also requires you to personally do the most work. You will have to…

  • Choose which state you want to incorporate in
  • Create and register a business name with that state
  • Determine for yourself which type of corporation you want your business to be
  • Register with the Internal Revenue Service as well as state and local revenue agencies in order to obtain a tax ID and all necessary permits and licenses
  • Complete the articles of incorporation documents yourself and file them with your state’s Secretary of State Office
  • Prepare your corporate bylaws, record minutes from your first Board of Directors’ meeting, and issue stock yourself

Incorporation Services

Incorporation services are able to explain the different types of corporations (such as LLCs, S-corporations, and C-corporations) to help you determine the best type of incorporation for your needs. These services generally offer affordable packages of services for small or mid-sized businesses to help them incorporate. Costs range from under $100 to near $1,000. Services performed by incorporation services include:

  • Name availability search
  • Preparation and filing of formation documents
  • Preparation and filing of your Tax ID number
  • Obtaining certified copies of state-filed documents
  • Creating LLC Announcements and certificates of publication
  • Preparing and filing state sales tax applications

Incorporating by Working with a Small Business Lawyer

Hiring a start-up or small business lawyer is the traditional method of incorporation, and it usually costs more than using an incorporation service. Your small business lawyer will register your business name, ensure that you have all necessary permits, and generally keep you on the right side of the law.

An advantage of incorporating with the help of a small business attorney would be his or her expertise about the law and your risks if your business is in a high-profile or high-risk industry. With businesses that have multiple founders, hiring a small business lawyer for incorporating is a good way of making sure that each of the founders has the appropriate agreements between himself or herself and the corporation.


Once you’ve determined that incorporation would benefit your business, using an incorporation service is something you should strongly consider. You will save money over the cost of hiring a small business lawyer, and you save time over doing the incorporation yourself.

Of course, there are exceptions. Someone with a business in an industry where liability can be high will probably find the greatest peace of mind by working with a small business lawyer, particularly one who is experienced in that industry. On the other hand, a business owner with a legal background may not find the do-it-yourself approach to be overwhelming at all.

For a large number of business owners, however, using an incorporation service provides the best combination of affordability and simplicity, so if you’re considering incorporating, you should definitely check out incorporation services and see if they’re a good choice for you.

Photo Credit: Victor1558

Business.com Editorial Staff

Business.com Editorial Staff

Author's Website: http://www.business.com

Author's Social Links: Author Google Plus Profile Link Author Facebook Profile Link Author Twitter Profile Link Author LinkedIn Profile Link

The Business.com Editorial Staff writes on topics relevant to small and medium-sized business (SMB) owners. Posts cover best practices, top tips, and studies that deliver insights specific to SMBs.

Our team has backgrounds in journalism, English, philosophy, marketing, entrepreneurship and management, providing us the opportunity to share unique viewpoints on all things affecting small and medium-sized businesses.

Posts by Business.com Editorial Staff

Quote of the Day – July 29, 2014

European Privacy Laws: What U.S. Firms Must Do to Comply

Quote of the Day – July 28, 2014

10 Inspiring Entrepreneurs Under 40

Quote of the Day – July 25, 2014

See all posts from this author »

View Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>