The Benefits of Incorporating in California
The main benefit to incorporating in California is that it effectively separates your assets from the business. That means the corporation is able to hold onto its own debts, and earn its own income. If things do not go well, the corporation is responsible for its own debts - it is unlikely that debtors will come after your assets to pay for what the corporation owes.
In addition to this, incorporating a business also offers some legal protection as corporations can be sued directly. Incorporating also entitles the board to sell shares of the business, allowing them to raise money without having to seek traditional loans.
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