Expenses related to your Home Business

Because most Home Business owners will want to incorporate, whether it be an s-corp, c-corp or limited liability company, the first expenses associated with your Home Business venture may very well be the costs of incorporation. In addition to the corporate fees themselves, there will also be legal fees if you choose to incorporate your Home Business with the help of an attorney. Although you can probably incorporate on your own, you will likely want to the assistance of an attorney because if you proceed without one, you may very well make an error that could mean that your corporation would not hold up under legal scrutiny. This is often called "lifting the corporate veil" and can be done if any number of steps is done incorrectly or not done at all, such as meetings or corporate minutes. And since one of the primary reasons you incorporate, if not the primary reason, is to protect yourself from legal liability, this can be a major shortcoming indeed. The majority of business related legal firms charge a flat rate to help you incorporate your Home Business, perhaps $500 on average. They will assist you in filling out the necessary paperwork such as corporate minutes and stock shares, as well as assisting you in setting up the necessary first shareholder meeting. Bear in mind that, as a general rule, the attorney fee's will be more if your Home Business has more than 1 shareholder. Add another $400 or $500 in this case. And add about $500 more $500 to $1,000 if you are going to sell shares to more than 1 shareholder, because your attorney will need to do paperwork for a shareholder´s agreement. As a matter of fact, you will pay more the more shareholders you designate. However, you can also cut your attorney costs down somewhat by you can save money by completing some or all of the pertinent paperwork such as certificates and articles of incorporation by yourself. Your local State´s office will probably carry the needed forms. If you go online, companycorporation.com can help.

In addition to attorney fees, you also have to pay filing fees: Secretary of State offices charge fees in the two hundred dollar zone, depending on which state you incorporate in. There could also be another couple of hundred dollars in other government filing fees. There is also first year franchise tax payments that every state charges corporations. These particular taxes might run you between eight and nine hundred dollars on average.

After you set up you corporation you will also have your accounting fees. In some cases the firm that helped you incorporate can also handle your taxes. You will probably have to pay general excise tax, which is a quarterly state tax on the earnings of your Home Business, and of course annual corporate taxes. The costs of these accounting fees vary so much that a reliable estimate can not be given since the costs vary tremendously depending on the number of employees(if any), corporate structure, state tax issues and many other factors.