How to Use Your Corporation
Once you’ve incorporated, you may be wondering what now? Well, remember your corporation basically has all the rights of a living, breathing person. The corporation can enter into contracts, sell tangible goods, own property and do a variety of business-related tasks all depending on the purpose of your corporation.
Remember to keep a strict separation of personal and business assets. For example, if you’re headed out on date night, pay for everything with your personal card, not the business card. While you may be the owner, don’t use your corporation as your personal piggy bank.
What’s the Purpose of Your Corporation?
If you’re operating your corporation as a straight-up business, remember that your corporation is the entity doing business, not you. That means you’ll be signing the corporation’s name to all kinds of things like leases, contracts, websites, anything business related. You want to keep your personal name off everything you can and list the corporation’s name instead. By listing the corporation’s name, you are creating separation between you and the business. You do this to limit your personal liability, as your business may not work out, but that doesn’t mean you personally should have to lug around any business debt if that happens.
Additionally, corporations can be used for a wide variety of purposes other than strictly doing business. Many people use corporations as holding companies. There’s nothing inherently weird or sketchy about this. Often people form an corporation to hold an asset like real estate. The corporation would then sell the land or simply hold it. To operate this kind of corporation, you’ll need to transfer assets into the corporation.