A young and attractive couple are having dinner. The woman looks up at her boyfriend, "There’s something I need to tell you...I love you!" advantage of their corporation!
He stays silent. He continues to stay silent, for what seems like an eternity. As any of us might do in such an awkward situation, the girlfriend eventually runs off, embarrassed and furious. And that’s when he finally says, "I love you too!"
Timing is everything. You may have recognized this scenario from a commercial a few years ago stressing the importance of timing.
Like the poor boyfriend in the commercial, many doctors and business owners often get the timing wrong in terms of when they incorporate their business or practice. Just because incorporation can dramatically help many people improve their situation, doesn’t mean it’s necessarily the right time for you. Deciding when to incorporate your business can be tricky.
Below is a rough guideline of factors that should be present before you incorporate. If they are there, it’s likely time to look more carefully into the process:
Although incorporating can be a huge advantage for many doctors and business owners, there are a few drawbacks:
The above points are some rules of thumb you should consider before going ahead with incorporation. They should be treated as a framework as opposed to gospel. I also provide my clients with a cheat sheet to decide if they’re ready for incorporation.
If you would like to learn more about getting incorporated, I recommend you talk with your accountant or feel free to contact me if you’d like more information on this or to get a wealth management opinion on your specific situation.