Incorporate Your Business
What does it mean to be incorporated?
- A business that is incorporated is regarded as its own legal entity, recognized by the Articles of Incorporation [pdf] filed with the Secretary of State.
- As a corporation, the business is separate and apart from those who own it.
- Many business owners choose to incorporate their business in order to protect their personal assets and liability from their business operations.
- There are several ways in which a business owner may incorporate their business.
Typical small business entities include:
- "C" Corporation
- Subchapter "S" Corporation
- Limited Liability Corporation (LLC)
Does a business have to be incorporated?
No, an individual can operate as a sole proprietor. Businesses with little assets and liabilities may choose this option. A sole proprietorship is a business that is owned and operated by an individual. A business may have less access to capital and financial resources and is exposing personal assets to the business. This entity requires the individual to report income on their personal tax returns using a Schedule C form. Upon growth of the business, the owner(s) may investigate other legal forms of entities for protection and tax purposes.
When deciding how to form your small business, it is recommended that you seek the professional assistance of a local attorney or accountant. Resources on all seven business entities are available at your local SBDC. You can contact the SIUE SBDC at 618-650-2929.
Through the Office of the Illinois Secretary of State, here are the guidelines to incorporate your business.
Other business entities include:
- Sole proprietorship
- R.L.L.P. Partnership
- Limited Partnership
- General Partnership
