Georgia law allows a business to incorporate and be identified as its own legal entity. When an incorporated business acts, whether it is to buy and sell property, agree to contracts or exercise legal rights, the process is then attributable to the business itself and not its owners. A business looking to incorporate in Georgia must file with the Secretary of State in accordance with established guidelines.
Benefits of Incorporation in Georgia
Certain advantages inure to a business in Georgia that has incorporated over one that has not. First, a corporation's liabilities can never go beyond the amount invested in the business by the owners. With unincorporated businesses, personal property of owners can be liquidated in order to fulfill the liabilities of the business. Furthermore, banks in the Grovetown area prefer to evaluate the credit worthiness of a business as a whole rather than that of individual owners. This makes the process of getting corporate loans simpler. Lastly, ownership of a corporation is divided into equal portions or "shares" of stock, which may be bought and sold much more easily than the ownership of an unincorporated business.
Costs of Incorporation
Incorporation comes at a price. First, Georgia might charge a filing fee to process applications for incorporation. Also, the corporation will pay taxes as its own entity. The individual incomes of owners who are paid disbursements from the corporation's earnings are still taxed as well. This is called double taxation, but it may be avoided with proper planning and assistance from a local Grovetown lawyer.