Incorporation is the process of legally establishing a business as a separate entity from its owners. When a business incorporates, it becomes a corporation, which is recognized by law as its own legal person. This process offers several key benefits, including limited liability, meaning that the owners (or shareholders) are not personally responsible for the business's debts or legal actions.
Incorporating also allows a company to raise capital more easily, offers tax advantages, and provides credibility with customers, suppliers, and investors. The process involves filing the necessary documents, such as Articles of Incorporation, with the appropriate state authorities. Once incorporated, a business can continue to grow and operate with a more structured and protected foundation.
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