Legal Question in Business Law in Maryland

As a Consultant, should I incorporate?

I am statring up a new business as a Professional Motivational Speaker and Consultant. For the first year of operation, I don't plan to have any employees, and I wan't to maintain complete control of the business.

The question is, whether or not to incorporate? If so, under what type of entity?


Asked on 10/03/99, 12:17 pm

2 Answers from Attorneys
MYRON LEWIS MYRON LEWIS

Re: As a Consultant, should I incorporate?

There are pros and cons to incorporate. Pros: Limited liability, certain tax advantages, ex., deduct 100% of Health Insur. Premiums for your employees...cons: Paying an atty. to set up your corp...shop around for price..Also, Corps. need annual Corp. tax returns and W-2's needed if you're a corp...Good luck w/your business!

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Answered on 10/06/99, 10:06 am
Abba D. Poliakoff Gordon, Feinblatt LLC

Re: As a Consultant, should I incorporate?

You should incorporate. The reasons are: (1) it will shield you from liabilities - other than personal professional service obligations, for example, lease obligations, purchase obligations, etc., and (2) you will be able to avail yourself of certain business deductions and receive tax benefits, such as for employee benefits.

In addition, if you add employees, you would be better served to have a corporate entity as the employer.

Finally, if you later sell your business, you would be better off if it is in corporate form.

An LLC is a good form to use, but if you envision selling your business or bringing in investing partners, you may want to use a corporate form.

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Answered on 10/05/99, 4:03 pm


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