incorporating

  1. Does anyone out there have information ab out incorporating as a RN? What are the pros and cons? any personal experiences
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  2. 31 Comments

  3. by   renerian
    Do you mean incorporating as an RN (inc.) to protect yourself from lawsuits? I incorporated our business but not me per say. Not sure if this is what you mean?

    renerian
  4. by   Agnus
    This is a question for the Nurse Entraprenure forum.
    Businesses not individuals may be incorporated.
    Incorporation means the business is treated as a seperate person.

    You cannot protect yourself from malpractice suits by incorporation. The individual nurse is still responsible for any malprrractice within her incorporated business.

    You may have a business that uses your personal name
    Jane Smith, R. N. Inc. That business is not you. It is seperate from you Jane Smith, R. N. the person who practice under that corporate name. You the individual are responsible for malpractice.

    Incorporating is done for serveral reasons, to protect the individual owners from excess taxation, to raise money to finace a business (for example selling shares). There is some liability protection for those in an incorporated business however this does not include, professional malpractice by a nurse or doctor. For instance if you slip on my greasy floor and are injured or I destroy your mink coat while drycleaning it in my drycleaning business, you sue the corporation and I am protected.

    However, If I injure you in a malpractice incident you will sue me the individual not the corporation. As the corporation is not responsible for malpractice I am.

    Some folks form a LLC Limited Libiality Company. Which is a modern spin off of incorporation (actually a spin off of Limited Liability Partnerships) The LLC is designed for a sole propriator or partners who want the benefits of incorporation without the restrictions of a more formal corporate structure.

    If your business is small and expected to remain small and depending on the tax structure in your state you might benefit by remaing a sole propriator. A LLC can give you credibility with other businesses; say, if you are marketing yourself as a one person registery.
    If you are just going to "try out being in business" the expense and hassel are not worth LLC or Inc.
    Contact you State Secretary who will be able to give you the requirements to incorporate or form a LLC in your state.

    For specifics as to whether you can benefit by incorporating your specific business see an attorney.
    Hope this helps
    Last edit by Agnus on Jan 16, '03
  5. by   MNicholsonRN
    Thank You! for your response. My question is pertaining to incorperating myself as a business. My wife and i are both RN's, can we incorporate together or does it have to be done separately
  6. by   renerian
    Our company lawyer advised us in our business, if we incorporated they can go after the business assests but not our personal assests like our home. Angus were you advised otherwise?

    renerian
  7. by   Agnus
    Originally posted by renerian
    Our company lawyer advised us in our business, if we incorporated they can go after the business assests but not our personal assests like our home. Angus were you advised otherwise?

    renerian
    This is true. However from my reading and that is about all I have to go by just yet, my understanding is this does not apply to malpractice by a MD or nurse. Which would also explain why physicians still must deal with malpractice insurance or risk loosing everything.

    to answer the question about if two people can incorporate together. Yes. The corporation actually become (in the legal sense) a third person in the equation who is seperate from either of you. The corp can be sued but both you and your husband are protected. The corp pays taxes seperately from you and enjoys tax benefits that you would otherwise not. However in some states I understand that to incorporate under certain cercomstances MAY be more of a tax liability.

    Did you know that even though you have your business in a different state you can incorporate in Nevada which has NO corporate tax, and does not share corporate income information with the federal government? Neither did I. However, you must have an agent of your corporation physically present in NV.
    To be honest it seems to me to get pretty complicated and from anything I read a lawyer to help you deside let alone do it is a must.

    I hope I might be wrong in my understanding about the medical and nursing malpractice but so far I don't see anything that says I am.
    Last edit by Agnus on Jan 19, '03
  8. by   nightingale
    I hope the posters do not mind my moving this thread to the Entrepreneur Forum.

    I was researching Corporation information and found this. Earlier this year, I was having trouble receiving my announcements and did not see this post.

    I hope others here would enjoy some dialogue on corporations.

    As for me, I am incorporated in another state where I havea legal representative in that state. I am thinking of switching over to NV for the tax advantages.

    Agnus, you set this up on your own if I am remembering correctly. How is the paperwork flowing so far? Any helpful suggestions on how to set up a Corporation in NV?
  9. by   Agnus
    Oh, Nightengale it was unbelieveable.
    Since I posted the previous posts I have learned a lot.
    On Feb 14 my hubby and I decided to go ahead with our business. We knew that we needed to incorporated because it is a high risk business with high potential for law suites. We consulted our lawyer. $800 was the quote we got. With the statement that "those people down there are a PIA to deal with." He was talking about the folks in Kenny Guinn's office Sec of State.

    We heard from so many "experts" about what we were up against how long things would take etc etc.

    Friday the 14 I went to Carson City (capitol) to the library. 20 minutes in the library and I was on my way to the Sec of State office as I realized how simple it was. I knew after 20 minutes I did not not need a lawyer.

    I picked up the paper work. On tue the 18 I went back and filed the articles of incorporation and the list of officers. On the 19. I had the articles of incorporation and a corporate charter.
    From there I filed and got my EIN, State business license, placed a bond with the sales tax board (we have no corp. nor personal income tax.) Got our county license, and filed and received our license to sell cars with the DMV all in 9 days.

    Now back to the Corp. I created the nifty little book you, (Nignhtengale) have with by-laws, meeting minutes etc. myself.
    Lawers want to do this so, "you do it right."
    The key to this is doing it at all is about all that really matters.
    There are secrets that lawyers keep from you when setting up a corp and helping you with the by-laws minutes etc. Because if you knew them it would take $$ out of thier pockets.
    In a private corp. things are a little less strict about the how as you control the entire corp yourself. And you generally wear all or most hats yourself.

    The paper work still needs to be done. However, a one man corp doesn't literally hold meetings. It is a formality. The language need not be so formal that you cannot understand it. Write it in English that makes sense to your ear. These are your by-laws and rules, and munutes so you need to understand them.
    If you ever belonged to a club that kept minutes you already know how to write minutes.

    I incorporated Nursing Without Walls, Inc. A few weeks ago. I have not done anything with this business yet as I am in transition with a new job etc.

    One of the things I am actively working on is a book about the inc. prosess directed at nurses.
    I will show you how to do it very inexpensively. Why you don't need a lawyer or even to consult your accountant, before doing it. Why you should probably do it. How to get around the pesky issue of double taxation. (you already solved this problem yourself, Nigtengale with your S-Corp)
    I am not saying do not use lawyers and accountants.
    You just don't need them for setting this up.
    We will talk about LLC, C-Corp, S-corp. I will talk about NV. And how you can inc. here and never set foot in this state.

    I will talk about why it is advantageous for you to inc. in NV and operate in your own state.
  10. by   Agnus
    You and you alone are still responsible for your professional malpractice as an RN. If you personally are guilty of mal practice you not your corp. will be held liable.

    There is a difference between malpractice and other liability. Nurses are always responsible for thier professional practice. However an injury that results from something other than malicious intent, nursing negligence, violations of standards of practice, or violation of nurse practice act is cover by the Corp. Bottom line. IF you are a nurse you will always be responsible for your Nursing Actions. A corp will not protect you if your practice is substandard unprofessional or violates laws, or standadards of practice.
  11. by   nightingale
    Wow, am settling into my destination and want to write a quick note to thank Agnus for this valuable input. I will read it over with a clear head tomorrow. Thanks again for the information Agnus.

    Yeah, I agree... lawyers are a hoot and would like you to think they are irreplacable; it annoys me incredibly that they are selling "themselves" at such a deceptive level.
  12. by   Agnus
    It is not that they are deceptive (IMO) They are protecting thier territory. I think they simply subscribe to the philsophy that, if you give the store away there will be nothing left to sell. It is good business sense. However, I did learn a few secrets.

    Did you know lawers do not learn about incorporating a business in Law school or any other school for that matter. That unless they do this regularly they know less than their clients about this. And that they do not draw up those lovely documents that fill your corporate records books. You can actually buy them preprinted which is what the lawyer does. In my case I custom made mine.

    It cost $340 to file all documents in NV, without a Lawyer. You Willl have the documents back in 2 weeks.
  13. by   nightingale
    Wow Agnus: That is great and is something I am looking into doing this same thing. I set myself up in Wyoming and imagine I can do it in NV.

    Thanks for the input.
  14. by   kvck
    Hi everyone,

    I just wanted to add a few things to the incorporation and malpractice information. I have set up many corporations and know a great deal about the tax and malpractice laws. A major thing to realize is that a corporation will not protect you or your assets against malpractice. If you do something wrong and receive a lawsuit then in 99.99% of the cases it will be against the corporation and you, lawyers like to include everyone they can. They will go after the corporation assets and your personal assets also. The major reasons to incorporate are to grow your business with other employees, receive tax breaks that are only available to corporations, open other ways to finance growth, etc.

    Hope it helps and I don't mean to scare anyone but that is the way it really works.
    Last edit by kvck on Sep 20, '03

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