Legal Question in Business Law in New York

Re: To Incorporate or Not.

There are many other factors distinguishing employees from independent contractors in the IRS test although setting up a legal entity to provide consulting or other services may often do the trick in terms of avoiding being categorized as employee.

Your obligations once you incorporate will largely revolve around corporate formalities (of acting through the appointed corporate officers -- which could all be you -- on behalf of the corporation, having proper record-keeping in terms of minutes/resolutions in accordance with your bylaws, maintaining the corporate bank account solely for business purposes and making tax and other filings as a corporation. Not a rocket science but does require a modicum of discipline and legal, tax and accounting advice depending on the complexity of your business.

There is no publication requirement for New York corporations though certain corporate information is generally available to the public. Limited liability companies do require a publication. Depending on how much you want to remain anonymous there is a range of devices to use but to a casual observer who is not familiar with the name of your corporate entity, the initial filing you make will not be too revealing.

The issue with how your employer would look at your side business is a different story altogether. Your employment agreement, if any, employment handbook, other documents and the nature of your employer's business will be of help in trying to determine if you are competing unfairly, violating any contractual covenants or otherwise looking for a way to get fired.

Get a business attorney to review your specific facts before taking the plunge. The above response is in the nature of general information, is not legal advice and should not be relied on as such.