| Incorporating in California is one of the best ways | | | | Another advantage of incorporation is easily |
| to protect personal assets from creditors and | | | | transferable ownership, as long as it does not |
| litigators. By operating a business as an | | | | conflict with securities law. A corporation in |
| incorporated entity in California, the risk of | | | | California works as an independent body, and |
| entangling in lawsuits can be diminished. The | | | | continues its operations after the owner's demise. |
| chances for having an IRS audit can be lowered. | | | | The death of an owner or the desire of the |
| Business operating losses may also be deducted. | | | | owner to sell his interest will be incorporated by |
| The primary advantage of forming a corporation | | | | the California Corporation. |
| in California is personal liability protection. | | | | Tax reduction is possible under certain |
| Incorporation in California helps to separate | | | | circumstances. Corporations in California are eligible |
| personal assets from that of the business. There | | | | for more tax deductions than businesses that are |
| is the possibility of law suits against a California | | | | not incorporated. An exemption from annual |
| Corporation. If so, there are legal provisions and | | | | minimum franchise tax is available for newly |
| UCC codes to protect owners, shareholders, | | | | incorporated or qualified corporations during their |
| directors and employees from personal liability. In | | | | first year of business. When compared to the |
| a sole proprietorship or general partnership, the | | | | self-employed, the audit rate for Corporations in |
| owners are directly responsible for the debts and | | | | California is also much lower. |
| obligations of the company. The California | | | | California is corporate-friendly and promotes all |
| Corporation has a separate legal entity from its | | | | kinds of businesses. The conditions in other states |
| owners. So if the company has a debt or claim | | | | are not as strong or favorable to business |
| from a law suit, the California Corporation is | | | | owners and corporate officers as in California. |
| responsible for it, not the owner. | | | | |