Incorporating for the New Year
Planning on incorporating your existing (or new) business and want to have it up and running January 1, 2009. Think it makes sense to start the ball rolling now? It might... but it also might cost you a bit of unnecessary expense.
Some states, California in particular, have an annual minimum corporate income tax. It is charged regardless of whether you make any money, or even do any business. So if you incorporate in California now, you're going to pay the minimum tax in 2008, even if you don't intend to really get underway until January 1, 2009. So it just doesn't make sense to do it now.
However, if you want to get a jump start on the new year, you can file your papers after December 18th in California and not pay the minimum franchise tax for 2008 -- at least if you don't actually do any business.
This works for California - I don't know about other states.
