To incorporate or not? That is the question

Originally published on February 2022, update on February + April + December 2023 for relevancy

Everyone’s usually surprised that after years doing my own consulting, I’m “still” a sole proprietor and not incorporated. Because the answer is always "it depends"... it depends on your risk tolerance and ability to find products and services that can help you reduce that risk.

Here are the trade-offs I’ve optimized for, in making this decision. Please note: this is not legal or accounting advice; please consult your lawyer and tax advisor to figure out what works best for you.

It’s not an easy question to answer. Here are some resources, questions and considerations to help you.

Considerations for Incorporating

There are many, many resources out there that discuss the pros and cons of incorporating, including: 

One of the biggest advantages is that only your business (and not you personally) are liable for any lawsuits or debts [ref].

If you decide to incorporate, should you incorporate in your state or in Delaware? 

If you do incorporate, don't forget to comply with the new Corporate Transparency Act (CTA) that goes into effect on January 1, 2024 (and avoid penalties):

Considerations for Sole Proprietor

Other Considerations

Good luck -- let me know what you decided on!

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