When you are starting a business, one of your main objectives is the potential expansion of your company and to become a major player in the market. There are many ways to grow and today we want to show you an effective way to join forces with your competitors and incorporating a Business Association. Ideally this Association would be representative of your industry and will include major companies in the sector. Establishing a new Association is rather simple and inexpensive. Incorporating an Association requires some paperwork but benefits outweigh the time and effort.
But remember there are differences between an incorporated Business Association and non-incorporated Association. We always encourage incorporating your Association as they offer several practical and potential benefits.
Here are some benefits that may help you to decide:
Accessing to More Funds
By starting an Association you have the ability to borrow funds from banks. Also by qualifying for tax exempt status, it is more likely to have access to public and private grants. You may use these funds in starting campaigns in order to promote your products or industry.
Business Associations usually are exempt from paying property and income taxes. In another word as long as income is related to charitable activities, your Association will not pay income tax on it.
Power of Advocacy
By forming a Business Association you will have the power to influence politics and lobby among decision-making public authorities and use this power in benefiting of your industry.
Protection from Personal Liabilities
Your Association can be a target of an unwanted lawsuit due to its advocacy efforts however, incorporated Association will play its role to put you in a better situation and protect you from potential issues. A Business Association may be sued, but its legal protections will shield personal belongings of members and officers such as properties, vehicles and money which are generally protected from personal liability.
When you are working for the right cause you will be amazed to know that there are many donors out there willing to help you. Tax laws usually encourage people and corporations to donate funds and properties to non-profit organizations. If your Business Association qualifies as a tax exempt organization, it is more likely to gather donations, as donors can deduct it on federal and state tax returns.
Separate Legal Status
A Business Association has its own legal status and bylaws and as a result, it has the power to sign contracts in its own name, giving them the ability to have transactions apart from its members or officers. An Association may also take legal action against others if necessary.
An Incorporated Business Association has the right of holding a property title. You may find it strange but in some places unincorporated Associations do not have this right to hold a title on their name.
There are also other small benefits to the incorporation of a Business Association which vary by country and location. For example in the United States of America you can get a discount on your postage.
Remember! The main benefit to start and incorporate a Business Association is to have a united voice in the industry.