Small Business Starter Tips - Part 1

Starting a new business is risky and often difficult, but the rewards can be tremendous. In normal economic times this can be a very daunting task, which makes starting one today even more daunting. With that said, if you have a great idea and have great determination nothing should stop you from creating that dream.

So if you are starting a new business (or even an existing one) here are some ways to save money from the ground up. First and foremost is the business structure. The easiest is an LLC, but as you grow larger, the self employment tax of 15.3% starts to hurt you. That's because every bit of income, regardless of whether you pay yourself of keep it in the business is subject to self employment tax.

If you see that you are losing too much money due to the self employment tax then the next option is to incorporate. There are pros and cons to each type of corporation. I suggest checking the IRS website for more information.

Now if you are experienced and understand fully the entire process of incorporation, then the cheapest way is to print out the IRS forms and mail them in. If you are new to this, which most small business entrepreneurs are, then I really suggest using a third party company like MyCorporation (an Intuit company) to help guide you through the process. This is much cheaper then hiring a lawyer and just as effective. They take you through the whole process from obtaining an EIN to articles of incorporation.