What are the best books to read if I'm interested in incorporating a business?

September 20, 2009 9:07 AM

What are the best books to read if I'm interested in incorporating a business? In this I'm interested in more legal-oriented books (taxes, finding a CPA), as well as general advice/best practices.

Additionally, I'll ask for a small bit of advice here:

Is it worth hiring a CPA from the start, or is this something we should think about in the future? I'd like to handle as much of this on my own as possible, but I'm also mindful of my own limitations, both with hours and expertise. Also, around how much should I expect to pay a lawyer for an initial consultation?

posted by christopherbdnk to work & money (9 comments total)

You absolutely, positively, have to have accounting services for a business you found, unless you know you are the type of person who can deal with lots of paperwork efficiently and quickly. Assuming you ever want to sell your business, you will need to have your books in order, in order that a buyer can properly value it; you will make this a lot easier on yourself in the future if you go through the trouble now of retaining the services of an accountant.

As for legal advice, much the same applies: if you want to make life easier for yourself in the future, the second-best investment you can make in the founding stages of the company is to retain strong counsel who can advise you on various issues that will arise, such as licenses and permits from the state, etc. How much you should expect to pay for counsel is generally dependent upon the town or city in which your counsel lives.
posted by dfriedman at 9:12 AM on September 20

Additionally, this business would be based in New York state (specifically NYC).
posted by christopherbdnk at 9:31 AM on September 20

I got a lot of help from an ebook and software from Nolo Press. The software asks you questions about the form of your business and fills out your state's form for you.

Once I decided that I probably wanted to be a one-person LLC, I made an appointment with a CPA who specializes in small businesses, and he agreed that would be the best form. We also discussed how I'd been doing my books as a non-incorporated contractor, and he suggested some changes. I had him do my taxes for the first year so I could see what changed there (very little), and now I do them myself.

If you're not sure about the local legalities (licenses, etc.) you might stop by your local Small Business Development Center. If they can't answer your questions, they can point you to an attorney who can.

I use Xero to manage my business books. Xero is based in New Zealand but I haven't had any trouble using them for my US business.
posted by PatoPata at 10:18 AM on September 20

Nthing Nolo Press books.
posted by Jacqueline at 6:17 PM on September 20

You don't necessarily need a CPA -- that's overkill for most small businesses. A competent, experienced bookkeeper will probably be sufficient for most or all of your accounting needs.
posted by Jacqueline at 12:35 PM on September 21

Yea, Nolo is a great resource in a variety of legal areas. Just did a provisional patent through them.

Do some preliminary research on what Lawyers and CPA's do so you don't go into it blind. Ask them what they would recommend be done for your situation. I've never had too much need for a lawyer after startup.

As for a CPA, I'd absolutely go with one. I would never touch taxes nor allow anyone other than a CPA at a reputable firm do it. I *want* someone (with teeth) between me and the IRS. That goes for payroll too. Get a payroll service when the time comes.

Bookkeeping (with initial guidance from the CPA or just get Quickbooks software) you could probably do yourself until it gets too much. At that point there are plenty of temps that could do it for you at a reasonable price.
posted by jamesalbert at 6:59 PM on September 23

To clarify, I asked the CPA for advice on structuring my business and its books. I do the books myself, using Xero. I had the accountant do the taxes for one year and now do them myself.
posted by PatoPata at 7:11 AM on September 24

Thanks so much for your help! I've read a few of the Nolo books on the recommendations, and they were very helpful. I'm contacting a local small business non-profit next week for recommendations for a good CPA and attorney, and the attorney only because we're going to need a few general contracts drafted up for the business.

Fantastic help, thanks again.
posted by christopherbdnk at 4:17 PM on September 25

As for referrals for a good CPA, please consider asking your bank representitive for a few names. It'll help you on a variety of levels, especially if you ever need financing. They like to work with known/reputable firms.
posted by jamesalbert at 9:27 AM on September 28