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No. of Recommendations: 3
Be very careful as depending on the type of corporation (C vs S) the liquidation can be very expensive tax-wise. It is very easy to get into one but extrememly difficult to get out.
discuss it several times with your accountant and attorney-most of tax reasons for corporations are now available for individuals.
The only major tax difference now is that amount of medical insurance that is deductible and that difference goes away next year.
Some reasons to incorporate might be:
1) limited liability (also check out LLC's) If this is the reason then spend some time with your attorney having him tell you how he(she) would pierce the corporate or LLC veil and get to your personal assets, then be sure you do all the "red tape" to protect yourseld.
2) To accumulate working capital-C corp's have a lower tax rate on income up to a point, but accumulating money in a C corporation can be expensive when it comes time to quit the business.
Keep asking questions (and take your wife) until it makes sense. We accountants talk a different language and you must make sure everything makes sense to you as nomater what any one says. YOU are the only one who really cares about you and your family.
Just a couple of random thoughts. Good Luck
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