Why Creating a Company Online Is Easier and Cheaper than Using an Accountant or Lawyer
You’re about to turn your big idea into something real – a registered business entity – a company. This is a huge step.
Because this is the first definitive step in a long journey, of course you want to get things right. And you’re probably worried that creating a company online would cause you to skip some crucial steps in the process.
In the internet age, though, you can get the job done quickly, accurately, and for a lot less money online than if you use an accountant or lawyer.
This article will reveal that, for many small businesses, creating a company online is actually the easier and cheaper option. Let’s get started with your other options first.
The Problem with Accountants
They are not necessarily qualified to give the best advice.
When you hire an accountant, you assume you’re getting a tax professional, someone who knows it everything there is to know about business formation and the tax code.
You need look no further than the IRS itself, though, to see that there are different levels of qualification for both unlimited and limited representation rights.
Even more problematic: they are not tax attorneys.
An accountant can file your formation documents for you, and they can let you know about tax projections that may flow from the legal entity you choose. However, they are limited in the amount of advice they can give concerning the risks and liabilities in the various legal entities.
To give such advice would be an ethical violation akin to practicing law without a license.
And that’s disappointing because knowing what your risk of failure is and what liabilities are inherent in the various legal entities is sort of why you’re hiring a professional in the first place.
Unless you are willing to fork over a lot of money and hire a tax attorney — in addition to an accountant — you are going to receive limited advice.
You’re still on the hook if you get audited.
Let’s talk about audits for a minute. Fear of audits is what motivates a lot of small business owners to use a professional to file their formation documents.
But just how logical is that fear?
Your odds of getting audited do jump once you become a small business owner, but the risk is still relatively low; just 2.5 percent of small businesses face audits, compared with 1 percent of individuals, according to Small Business Chron.
If you do get audited, you are responsible for the actual baseline data that you give to your accountant. They, on the other hand, are only responsible for the calculations they make using that data.
An accountant can help you present your case to the IRS in the event of an audit. However, that individual does not need to be the same person who filed documents for you and does your taxes.
The truth is, if you do face a business audit, you probably won’t want to use an accountant to represent you, opting instead for representation from an experienced tax attorney.
The Problem with Tax Attorneys
A good tax attorney is a great thing if your business get audited.
They might also come in handy if you intend to do business internationally. And of course, if the IRS has you under criminal investigation, you might need an attorney to file suit for the disclosure of documents and to act as your representative.
When you need the resolution of complex tax situations, a good tax attorney is worth every penny.
The trouble is, tax attorneys are expensive, charging anywhere from $150 – $450 an hour for their services.
Hiring them to fill out standard business formation documents, like the Articles of Formation for an LLC, is probably not the best use of your money, especially when there is so much free and low-cost information out there.
The Benefits of Creating a Company Online
As you can see, there is no reason not to create your company online. In fact, there are distinct benefits of doing so.
A Variety of Business Services at Your Fingertips
Once you file the formation documents, you will need a registered agent to receive official mailings on behalf of your company. Many legal entities also require an EIN for tax forms and banking.
Online business formation services include these and other services along with document filing. Intrepid entrepreneurs can save money by taking advantage of special deals.
Filenow, for instance, offers the first year of their registered agent service completely free of charge on all Premium plans.
One Convenient Location
Online business formation services take the mystery out of filing formation documents and starting your business. The steps you need to take are right there, and they complete the forms you need to get started and maintain good standing in the state where you registered your business.
Backed by Experts in Business, Tax, and Law
You’re not just doing it yourself. Online filing sites have lawyers, business professionals, and tax experts working hard behind the scenes to ensure that fillable forms conform to up-to-date state requirements.
What’s more, you can pick up the phone and call to get specific questions answered as you fill out the forms.
Document Delivery and Data Storage
Gathering together paper documents and taking them to FedEx is a huge inconvenience. Fortunately, online business formation services offer online document delivery and express shipping. You don’t have to bother with scans, faxes, copiers. Just input the information, and you’re good to go.
Another great thing about online filing is you only need to input data one time. It remains securely stored in case you need to make changes later on.
Money Back Guarantee
If you’re not satisfied with a tax professional’s advice, there’s little to no chance of getting your money back.
Online business formation services, however, usually stand by the information they provide, and if for any reason you are dissatisfied, they will refund your money without question.
Cost- and Time-Effective
Accountants and lawyers charge between $150 to $400 an hour, and if you want to make those dollars last, you’re going to spend some time off-scene gathering information yourself.
Doing the whole thing yourself means figuring out exactly what the requirements of the state where you want to register your business are. That can be a laborious process. Forming a company online not only costs less; it takes much less time. That leaves you more resources for what really matters – getting your business off the ground and off to a great start.
Create Your Company Online with Filenow
We believe that Filenow is one of the best websites to create your company online. Backed by a team experts, we offer a better service at a lower cost than our main competitors. Compare the differences to see why Filenow is the best option.
Still not sure? We’re also the only company creation website service to offer a complete money-back guarantee.
So why not give us a try. Our easy to use process takes no more than 15 minutes, and we’ve used language you won’t need a lawyer to understand!