Incorporating your small freelance translation business
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March 24, 2011
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April 5, 2011
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I have discussed with many colleagues about incorporating a small freelance translation business, and most of them recommend doing so due to tax benefits. I have also discussed this with business lawyer friends and last year there was a bill proposal for removing these tax benefits for small incorporated businesses. Luckily, this bill did not pass and I have now finally incorporated.

The most common entity option for freelance translators seems to be an S-corporation. This can vary by state, depending on the state laws. After contacting SCORE, a great no-cost resource for small businesses in the US, I was referred to a great financial service business, called Main Street Tax and Financial Services (“Main Street”) to incorporate. That is when I also heard about another entity, an S-elected Limited Liability Corporation. This is what they say about an S-elected LLC: “While taxed as an S-Corp, an S-LLC is not required to have the same meetings & document maintenance requirements of an S-Corp.  For all liability issues, the entity is treated as an LLC.  For all tax issues, the entity is treated as an S-Corp.”

I chose this option and opted to have “Main Street” to do all the work for me for a reasonable fee. If you consider incorporating, I recommend booking an appointment with SCORE first and then choosing a financial service company to do the incorporating for you. SCORE can recommend these companies also help you with other questions you have for your small freelance business.

Corinne McKay also gives great advice on incorporating in her blog: “Webinar question: Should I incorporate?” and “Some thoughts on incorporating”.

Do you have any other thoughts on incorporating? Are you incorporated? Please share!

 

Tess
Tess
Swedish Translation Services is a company owned by Tess Whitty, a freelance translator (English-Swedish), proofreader, editor, copy writer, localizer and entrepreneur.

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