Incorporation
 

If you are entering this online industry as a sole proprietor is it almost a necessity to incorporate because of possible lawsuits? What have you done?

Possible law suits in what regards? Overall I think being incorporated is a much better decision, your wallet will be much happier. Mine is anyway.

as a matter of liability, I'd say yes. I seem to recall there being many many LLC's around here, with a few s corps thrown in as well. C-corp....not many here would warrant the pain of that.

You can get lawsuits in any industry. If you do your homework right you won't get lawsuits (most likely).

Incorporation is mostly done for tax needs

stevendice:

Often the case will be that "incorporating" will not cover the owners/operators of websites from such stuff as criminal actions. Ya don't have to do much to have a "criminal action" say, on "porn" - that is easy as hell to instigate at the whim of someone.

For tax purposes, it can often be good.

If you live in, eg, the US it may be handy from the angle of civil actions simply because of the volume instigated in the US.

No, depending on the type of corporation, your personal assets can not be vulnerable to any law suit brought on the corporation. So say for example somebody sues your corporation for $100k, your personal assets should be protected.

But yes, taxes are one of the main reasons.

stevedice:

Sorry.. missed the above. OK.. got assorted corps in various jurisdictions where the only laws recognized are those of the jurisdiction. That basically means their courts would not entertain crap suits and you would have to do some serious shit to be a problem - ie gun running and murder :-)

Incorporation is easy and cheap. and something that you should do. Talk with an attorney, and then incorperate. You can do that part online in some states.

Is the paperwork of running a personal corporation a pain in the ass? Should you hire an accountant to look over everything?

It's smart to have an attorney, cuz you'll need one come tax time.