While anyone can create a small business, there are a number of benefits to forming a business legally. In addition to legally establishing the business as an entity, forming a business can also grant protections and open up avenues that would not be possible without a legally recognized business such as applying for a business loan.
Business formation, also known as incorporation, is the process by which a business entity is created legally. While anyone can create a small business, unless it is incorporated the assets of the company are considered to be personal assets.
While there is no specific requirement to incorporate a business outside of the requirements of the state or country of incorporation, but there are some people who can be helpful in the incorporation process. In order to ensure that the business is legally distinct, properly incorporated, and assets are properly distributed, a business law attorney should be consulted.
The cost to incorporate a business can range from a few hundred to thousands of dollars depending on the state where the incorporation is occurring. The typical costs of incorporation include filing fees, pretax payments, governmental fees, and attorney’s fees. The more complex the business being created, the more expensive the cost to incorporate will be.