- Keeping corporate assets and personal assets separate (no commingling of funds);
- Holding shareholder and director meetings at least annually;
- Maintaining a corporate record book including bylaws, minutes of shareholder and director meetings and shareholder records;
- Filing annual information statements with the Secretary of State; and
- Filing a separate tax return for the corporation.
By: Theodore Schneider, Esq. The primary advantages of operating as a corporation are liability protection and potential tax savings. Like any important decision, choosing whether to incorporate involves weighing the pros and cons of the various business structures and requires careful research. Once incorporated, the business becomes a separate legal entity, and assets of the corporation are separated from the owner’s personal finances. As a result, the owner’s personal assets (house, cars, savings, investments), generally can be shielded from creditors of the business. However, to maintain this legal separation and avoid a creditor “piercing the corporate veil,” the corporation must observe certain formalities, including: