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    Shavedndropped's Avatar
    Shavedndropped Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Nov 23, 2008, 07:04 PM
    Sole to Corporation?
    If I do this will be able to "start with new credit" Ifi am a business owner with bad credit, can this help me start credit for the business. Will it give me more opportunities?
    Forgiveme's Avatar
    Forgiveme Posts: 42, Reputation: 4
    Junior Member
    		  
    #2

    Nov 23, 2008, 07:05 PM

    What are you now?
    Forgiveme's Avatar
    Forgiveme Posts: 42, Reputation: 4
    Junior Member
    		  
    #3

    Nov 23, 2008, 07:09 PM
    If you are sole propeitor it is using your social security, so you are using your personal credit and assets.If you start a corporation and get an ein number you can have that corporate shell protection and get credit under your corporation. Make sure you get an accountant.
    Forgiveme's Avatar
    Forgiveme Posts: 42, Reputation: 4
    Junior Member
    		  
    #4

    Nov 23, 2008, 07:15 PM
    Limited Personal Liability
    One of the main advantages of incorporating is that the owners' personal assets are protected from creditors of the corporation. For instance, if a court judgment is entered against your corporation saying that it owes a creditor $100,000, you can't be forced to use personal assets, such as your house, to pay the debt. Because only corporate assets need be used to pay business debts, you stand to lose only the money that you've invested in the corporation.

    Exceptions to Limited Liability
    There are some circumstances in which limited liability will not protect an owner's personal assets. An owner of a corporation can be held personally liable if he or she:

    Personally and directly injures someone
    Personally guarantees a bank loan or a business debt on which the corporation defaults
    Fails to deposit taxes withheld from employees' wages
    Does something intentionally fraudulent or illegal that causes harm to the company or to someone else, or
    Treats the corporation as an extension of his or her personal affairs, rather than as a separate legal entity.
    Forgiveme's Avatar
    Forgiveme Posts: 42, Reputation: 4
    Junior Member
    		  
    #5

    Nov 23, 2008, 07:16 PM
    Forming a corporation limits your personal liability for business debts, but running one takes work.
    Fr_Chuck's Avatar
    Fr_Chuck Posts: 81,301, Reputation: 7692
    Expert
    		  
    #6

    Nov 23, 2008, 08:22 PM

    It will take time to build credit, they will look at profit and loss and tax records over several years of business or of the yeasrs in business.

    Some lines of credit may ask for personal credit historyif you have not been in business for very long,

    But after you have been in business, worked on getting small credit under company, and pay on time, you can build up good credit, it does notcome automatically
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