Hello experts. So I have been operating a business unincorporated and basically just under my name. I have now recently incorporated it and would like to take the money that is still unspent and move it into the new corporation bank account, but I don't want it to seem like new income. (Or does it matter?) Can I just move money into the corporation at any time be it from my own pocket or other income sources to be used? Or is there some special way to move money into the corporation?
Signed, So New
It really depends under which legal jurisdiction you are. The tax laws are very different in each country.
Very generally speaking, every income needs to be accounted for, but what you could do is transfer the money to your corporate account and register it as a founder's loan to the company (which may or may not be paid back to you in the future). You just need to take into account that you still may need to report the source of the income (even if you didn't have a company then) and pay taxes for it (if applicable in your case - again, it depends where you located, how you're registered with the tax authorities, and what the amount is).
* Disclaimer: the above should not be seen as legal or tax advice as this is impossible to give without knowing all the details. You should always consult with an accountant or lawyer. I can try connect you with one if you let me know your location and budget.
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If you are the owner of the corporation you can transfer cash into the corporation in exchange for stock and its generally not a taxable event. The cash you contribute to the entity is recorded as either common stock or additional paid in capital which are all equity accounts. None of the cash should be recorded as income of the business. Alternatively you can fund the bank account and record the amounts as a shareholder loan on the company's balance sheet.
In the United States there are not restrictions for money to be transfrered into a your corporation. However it should be properly documented within the minutes of the shareholder meeting. The infusion of capital can be either the purchase of stock or an officer's loan. If it is the purhase of stock it should be documented in the stock purchase ledger and stock certificated should be signed and given to you the stock buyer.. A stock purchase ledger comes with a corporate kit which is usually provided by the company or person that set up your corporation. If the infusion of capital is an officers loan, a written promisory note should be created and signed by the lender and borrower and stamped and signed by a notary. The note should charge interest and payments should be made on a monthly basis and interest should be charged. You the lended should receive a 1099 from your company if it pays you more that $600 for the year. The Corporation would expense the interest on the corpororation tax return and the lender (you) would put the interest received on their personal tax return. ***Note this is not legal advise or tax advise this is a general discussion of the topic. You should speak to your attorney or accountant before acting on anything discusses in the forum.