Great question from Facebook. What are the pros and cons of incorporating?

By Shannon Stahlin, CEO, Direct Incorporation

One of our Facebook friends posted a great question on the Direct Incorporation page this week asking whether she should incorporate her business.

Here’s her question:

“ So – I write a blog but have not done anything about actually registering a business name or incorporating. I make a little money through advertising, not a lot. Should I make things formal? Wondering about pros and cons, especially cost-benefit tradeoff.”
– Erika Kerekes, who writes the food blog In Erika’s Kitchen

Here’s my answer:

“That’s definitely a great question and I’m happy offer some help. (Read our disclaimer and keep in mind that we are not a law firm and cannot offer legal advice.) There are definitely benefits to incorporating a business that is generating any amount of revenue.

One needs to balance the benefits with the cost. Not just the cost of incorporating but the cost to keep the LLC/Corp going – particularly, more administrative work and annual fees. The annual fees vary by state. For example, the annual fee is just $15 in Michigan, but $800 in CAL. Which state are you in Erika? As for the administrative work, we have a program to simplify and assist you with “corporate formalities” and deadlines: We make it pretty easy for our clients to knock down these requirements.

On the other hand, there are numerous benefits to incorporating or forming an LLC, but there’s a few that stand out. To start, there can be tax benefits, sometimes significant, depending on your choice of entity. You will also legitimize your operation with an official corporate name – In Erika’s Kitchen, LLC. The name also gets locked in with the state, so no other entity can apply for that particular name, which can also kick-start potential trademark rights in the name.

Another key benefit is the liability protection that an entity offers. The general rule is that if the business is ever sued, you can collect against the business, not the owners of the business. Peace of mind for any business, don’t you think?”
– Shannon

We love hearing from clients on our Facebook page. If you have questions, please don’t hesitate to post them on Facebook or right here on our blog. I’ll do my best to answer them. Thanks. – Shannon

Published by

Shannon Stahlin

Tips for the first 6 months of Your Small Business, starting with Your Incorporation.

4 thoughts on “Great question from Facebook. What are the pros and cons of incorporating?”

  1. I was so glad to get that information, Shannon – it’s great to know there’s a place to go for this kind of input. I’m just starting out with my business. I have so many questions!

    1. Hi Horace! We would be happy to help you get incorporated. Here at Direct Incorporation, we offer three levels of incorporation service. Our Premier Incorporation Package is our most popular because it includes your Corporate Records Binder, Stock Certificates and Corporate Bylaws. That package is $317 + the State fee. Our Standard Incorporation Package is $149 + the State fee. We also offer a Venture Package for $773 + the State fee. Many of our clients in the small business segment like this one because it gives you to everything you need to start your company: Premier Incorporation Package, Logo Design, Trademark Search and Software, Domain Name, Website and Document Compliance. Here’s a link to a more detailed description of each package:

      Please give one of our Sales Reps a call if you have any other questions or if you’re ready to get the incorporation process started. We can be reached at 877-281-6496.   Or, if you prefer, you can fill out our online application at this link:


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