Forbes magazine recently published an article stating that in the last decade, "the average jury award in tort cases as a whole has tripled to $1.2 million, in malpractice it has tripled to $3.5 million and in product liability cases it has quadrupled to $6.8 million according to just released data from Jury Verdict Research."

According to BizStats.com, only 22% of all the small businesses in America are corporations or LLCs. Over 72% of business owners are personally exposed to liability risk.

Protect yourself by incorporating! 

Tax Savings
 

By forming an S corporation (forming a corporation and electing "S" status with the Internal Revenue Service) you may end up paying less taxes than you would by operating your business as a sole proprietorship or partnership.

Business owners are required to pay "self-employment tax" which covers Medicare and Social Security; it's usually calculated on 15.3 percent of profits. Contrast this with an S corporation. In an S corporation, self-employment tax is due on salary only, not your entire profits.

Here's an example: Say, in 2010, you have net income of $90,000 and pay yourself $60,000 in salary, leaving $30,000 in the business. As a sole proprietor, you would pay self-employment tax on the full $90,000 ($90,000 x 15.3% = $13,770). But as an S corporation, you would only owe self-employment tax on the $60,000 in salary ($60,000 x 15.3% = $9,180), resulting in a savings of $4,590. Ultimately, you can save thousands of dollars by forming an S corporation