There are a lot of good reasons to get incorporated. First and foremost among them is the legal protection a corporation offers to its founders. Companies are treated just like individuals under the law, so if someone decides to take legal action against your company, and it's incorporated, that means your personal assets aren't at risk. That can be a big deal, especially if you're under 18, in which case the assets in question aren't yours--they're your parents' or legal guardians.

Most companies hire a lawyer to file incorporation papers with the Secretary of State of the state that they want to incorporate in, but you can also incorporate on-line via a site such as the one that's advertising right here. It's not always the state where you live; Delaware, for example, provides a lot of favorable corporate laws, so some of the biggest companies in the United States are incorporated there even though their corporate headquarters are located elsewhere. You should talk to your attorney about the best place to incorporate, or you can look up a lot of information on-line. The internet is a great tool to find information. Some states may even let you file certain papers on-line, or at least download the right Adobe Acrobat PDF forms. Just search your favorite search engine for "Secretary of State" and then your state's name.

You should also consider what kind of company you want to form. Most small businesses are subchapter-S corporations or Limited Liability Companies (LLCs) for tax reasons. There are many good discussions of the differences between the two types of companies. One of them can be found here.

The IRS has made the process of getting an EIN fairly easy! Just visit the on-line Form SS-4 and follow the directions to complete it.

Most small businesses don't use the financial tools available to them to their benefit. You should. First, find a bank in your local area that is willing to offer your business a free checking account with a low minimum balance. Typically, larger banks require more of their corporate customers. Small banks are the ones who are looking for new clients, and therefore they are more willing to be lenient, and work with small businesses.

Corporate bank accounts rarely, if ever, offer interest on deposits, meaning that as interest rates climb higher, you effectively lose an increasing amount of money. This can add up over time. There are two ways around this problem, both of which make use of money markets: extremely low-risk investments that typically yield from 3%-5% annual returns. Your first and easiest option is to set up a PayPal account. PayPal allows you to optionally place your balance in an automatic money market fund that is managed by Barclays (a very large and reputable financial institution), which happens to have one of the best returns in the industry. All you need to sign up is an EIN, which you already should have from Step 2. Having a PayPal account also lets you send and receive payments to and from customers and vendors. (You should keep in mind that although there's no fee for having your funds deposited in the money market, PayPal does charge businesses for the service of sending and receiving funds from other companies and individuals.) Your second option is to open a corporate brokerage account with an on-line stock brokerage such as Fidelity, E*TRADE or Ameritrade. All of these institutions typically "sweep" funds that are not invested in securities (such as stocks or mutual funds) into money market accounts, meaning that even if you don't invest anything, you can still earn interest on money that you don't need in your checking account immediately. WARNING: KEEP YOUR OPERATING CASH LIQUID! DO NOT INVEST YOUR COMPANY'S OPERATING BUDGET IN THE STOCK MARKET, WHERE IT MAY LOSE VALUE.

American Express - Platinum Cash for Business (No Annual Fee)	American Express - Blue for Business (No Annual Fee)	American Express - Gold Rewards for Business (Annual Fee After First Year)

The next step in setting up a good financial infrastructure for your business is getting a corporate credit card. From day one you should keep personal expenses completely separate from corporate expenses, which means that you should have an easy way to distinguish between them. A corporate credit card is the perfect way to do this. American Express has a very aggressive marketing campaign targeted at small businesses called the "OPEN" network, which has the benefits of some useful discounts at a few often-used vendors such as FedEx. Though the company offers a variety of cards, we suggest signing up for either of the ones advertised right here. The cash-back card has no annual fee, while the Gold Rewards card does have an annual fee after the first year--but if you plan to spend a lot, the rewards points may add up to the point where the card more than pays for itself. WARNING: ALWAYS PAY YOUR CREDIT CARD BILLS ON-TIME OR EARLY WITHOUT EXCEPTION. LATE FEES ARE ENORMOUS, WILL AUTOMATICALLY VOID ANY CARD BENEFITS, AND CAN DESTROY YOUR BUSINESS.

Think's flagship software application, Exponent, is designed to keep track of everything a business might need to keep track of, from customers to orders to money coming in (Accounts Receivable) to money going out (Accounts Payable). It's all web-based, it can keep track of multiple bank accounts (including PayPal and brokerage account), credit cards, and employees, and it's free. You should sign up. You'll never have to worry about making a customer database or buying over-priced accounting software ever again. The more organized you are, the better.

While Exponent Free will also do your taxes for you if you're an S Corporation, which is an incredible time-saver, you will need to upgrade to Exponent Enterprise to run payroll on your own. Payroll, the process of calculating and paying a number of different taxes that are based on the wages you pay employees (including yourself as the business owner) is very complex and varies from state to state. Many companies choose to outsource it to a third-party. Think started off that way, but we think Exponent is actually more reliable than full-service payroll companies (which are also very expensive). You should do homework to figure out which way works best for you.

Your company's image will be one of its most important assets, if not the most important. Think charges $500.00 to design a corporate logo, letterhead, envelope, and business card template. No matter who you use to design your logo, make sure to ask for a few things:

• Multiple versions, so you can choose one you like best.
• PostScript fonts only! You may not be able to tell the difference, but the most professional graphic designs only use Adobe PostScript Type 1 (or OpenType) fonts. Arial, Times New Roman, and most fonts that come with Windows do not fit this bill, and your customers may perceive a lack of professionalism.
• Digital copies in Encapsulated PostScript (EPS) and/or Adobe Illustrator (AI) formats with fonts converted to outlines. This will prevent font location problems from fouling you up in the future.

Once you have a logo and paper materials, you will also need a web site. Web sites have several components. You can buy a domain name (e.g. yourcompany.com) for a nominal annual fee using the advertisement right here. Think provides excellent web site hosting services. You might wonder what the difference is between Think's hosting services and someone charging $2.00 per month. The answer is customer service. In many things in business, you get exactly what you pay for. It's worth having a web site that you can update, that actually stays up on the web, and that has customer support personnel who you can reach and understand. Lastly, you'll need a web site design, which you may be able to obtain from a dedicated web site designer or your graphic designer. Content management systems, such as Think Whiteboard, are optional, and just make it easier for people to update their web site. The site you're reading right now runs on Whiteboard.

Chances are that if you are going to run a large and successful business, you will inevitably have to accept credit cards. The credit card processing system can be a complete pain to deal with, but there are benefits, as well. It's important to fully understand both sides of the equation.

Some of the problems are that processing credit cards is expensive, can be frustrating if your customers' cards are declined, and can require lots of equipment such as card swiping devices and receipt printers.

On the plus side, if your customer base increases because more people are willing to pay you via credit card, the transaction fees can pay for themselves. Most cards aren't declined, and when approved, the money goes directly into your checking account, so there's no risk of it being lost. Lastly, Think resells the Authorize.Net Integrated Payment Service, meaning that everything is handled on-line (and integrates perfectly with Exponent from Step 4). There no expensive equipment to buy or lease. All you need is a web browser, an EIN, and your checking account from Step 2.

Once your business is up and running, it's important to make sure you have equipment that will keep things steady. You can buy computers and computer equipment at great prices from Think's IT Consulting page. Of course, you can also call us for IT consulting, as well! Some things you might want to consider purchasing include:

• Laser printers, which are much more cost-effective than ink-jet printers.
• Scanners to use for marketing and accounting purposes.
• Wireless routers to allow employees to connect to the internet from anywhere in your office

There are a number of ways that you can advertise your business. One of them is on-line, through Think's CommonRoom spam-free e-mail system, and Exponent management software. You can use our shopping cart to place your ad order on-line.