Choosing the right legal structure for your business is one of the first big hurdles you will face as an entrepreneur. If you choose to form a corporation or an LLC, you will likely weigh the decision of working with a local lawyer or using an online incorporation service.
While incorporating online can be quick, easy and relatively cheap, there are some critical pitfalls you are liable to stumble across if you choose this route. Understanding the risks of using an online incorporation service will help you make the best decision for the future of your budding business.
Costly mistakes
Incorporation services typically provide document templates that you can fill out yourself. Without the guidance of a legal professional, it is possible that you might enter erroneous information on these documents which may become extremely costly when it comes time to file a tax report for your business.
Insufficient documentation
A one-size-fits-all approach may sound convenient, but the lack of personalized service you get through online incorporation means that your legal documents are not tailor-made for you. Opting for a more customizable service ensures that you will satisfy the specific needs of your unique business and that there will be no legal gaps in your documentation.
Lack of legal compliance
In many cases, incorporating your business is only one step toward ensuring that your new venture is fully compliant with Connecticut business law. There may be specific permits to obtain or zoning laws by which you must abide, and you will not receive any guidance on such matters through an online incorporation service.
While using an online incorporation service offers an affordable solution for new business owners on a budget, it is possible to save money in the long term by choosing a high-quality and personalized service from the outset.
