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Business Incorporation

Updated: Nov 18, 2021

Incorporation is the legal process used to form a corporate entity or company. A Corporation is the resulting legal entity that separates the firm's assets and income from its owners and investors.

Incorporated means that a business has filed documents with a state to become a corporation. The term incorporated is used because, by filing the certificate of incorporation and going on record with the state, the owners become legally separate from their investment and the business itself.

Both types of entities have the significant legal advantage of helping to protect assets from creditors and providing an extra layer of protection against legal liability. In general, the creation and management of an LLC are much easier and more flexible than that of a corporation.

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