Limited liability

Liability protection is generally the main non-tax reason to incorporate. 

 

Incorporating creates a legal separation between your personal assets and your corporation's assets. An owner of an incorporated business or practice cannot be held personally liable for the debts and obligations of the corporation. 

 

Incorporation limits your exposure as a shareholder and owner since you are only risking the money that you have invested, not your home, personal finances, inheritance, or other investments.

 

Incorporation will protect you financially by limiting your liability.