It isn't quite as valuable as, say, a large group of owners, but that's
really just a perceptual thing (if a Jury sees one guy as chief, cook,
and bottle washer they're less likely to believe the law). I am careful
to keep my "corporate veil" intact, primarily meaning that me and my
corporation are two entirely separate financial entities, and the only
exchange of cash and property happen above the table, with all necessary
tax ramifications. I am simply an officer of the corporation. This is
in comparison to an LLC (limited liability corporation).
I just read Bill's response. He's correct that incorporation tends to
lead credence, even if undeserving. I also believe that it does raise
the bar for personal liability, but even a multi-owner corporation
doesn't shield its officers completely. Interestingly, most of your
corporate financial dealings will probably have to be personally
guaranteed. And of course, for engineers, your professional status and
licensure will transfer additional risks to you personally which would
otherwise not be involved
One of the reasons for incorporation was that I expected to grow and, I
am told, corporate status puts me in a more secure (personal financial)
position in the event of employee-employer disputes. I'm now three
people (though the other two are part time), and may need to be four in
the near future if the work doesn't slow down.
I haven't found the paperwork difficult or overly expensive. For the
extra $500 a year (registrations, taxes, licenses), I sleep better at
night, and I know that I'm prepared should I suddenly find that this
sparsely populated area of Virginia suddenly realize that it can handle
a large structural firm. ;-) And $500 seems like a drop in the bucket
compared to E&O insurance!
Gautam Manandhar wrote:
You indicated that your are a one-man team and are incorporated. It is my understanding that because you are a one man team, the protection from loss of personal property generally provided by incorporating is not avaialable for a one-man team. Could you shed some light on the benefits of incorporating.
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