I was a paralegal for 11 years until I did this. Basically, and no, I don't know what a lawyer knows, but...incorporating does shelter you somewhat from lawsuits from customers, i.e. in case of injury and such. But a good liability policy should protect you in such cases. But, even if you incorporate, you still need credit from your vendors. You will still need to sign a personal guarantee on any credit your company extends. If you default, you will be sued along with your company. And if the Court finds that you defaulted and owe the money, you and your company will get a judgment against you. If you incorporate or don't incorporate and one of your employees majorly screws up, you are responsible for them and their actions and thus can be sued personally along with your business. As far as taxes are concerned, if you're incorporated, you must pay yourself a salary and you will be taxed. If your company makes a profit, the company must pay taxes on the profit money. So...What's the difference in being self-employed? I myself am self-employed. I don't pay myself a paycheck but I do pay self-employment taxes and pay taxes on my profit. so what is the difference? 1/2 dozen or 6 of another I say.