Getting sued is never fun. When your personal wealth is at risk, it can be downright scary. Incorporating your business can help protect your personal assets from being targeted by business-related lawsuits.

Simply put, when you incorporate your business, it becomes an independent legal entity. One of the implications of this is that it means that you, as a business owner, are no longer personally responsible for the debts that your company may incur. This protection is known as limited liability. If your business is set up as a sole proprietorship or partnership, on the other hand, you do not have such protection. For many businesses, reducing this risk is the primary reason to incorporate.

There are three basic ways to incorporate. For the least expensive route, you can do it yourself. All you need to pay is the state filing fee and complete the appropriate documents. The hidden cost here is the time it takes to understand what is needed for filing.

You can also incorporate via the Internet through an online incorporation service provider. With this method, you choose the state in which you want to incorporate, select the corporate structure, and provide the information that is requested of you. The service then compiles this information and files the application for you.

Online incorporation services differ in a few important ways. First, there are differences in state coverage. While some specialize in a handful of states, others will handle filings nationwide. In addition, while some services feature incorporations only, others also provide related business services. These services include trademark submission, domain name registration and federal tax ID application.

Support differences can vary greatly, too. While some online services offer extensive content to inform you about your corporate structure options, others do not. More importantly, the availability and knowledge levels of customer support can vary, too. Conflicting information can arise as a result. Keep in mind that any information you do obtain online should also be complemented by conversations with your accountant or lawyer to ensure that you make a sound decision.

Fees vary according to the state in which you file, the corporate structure you choose, and the service fee charged by the vendor. You can generally expect to pay $25 to $200 for the service fee in addition to the required state filing fee.

Attorneys are probably still the best choice to handle the filing if you plan to take on investors or make your company public. They can provide the custom advice to make sure you take the right steps to structure your company appropriately. In addition, they can create any additional documentation that is necessary if outside investors are involved upfront. Costs are higher, though. Fees in the $500 to $1000 range for the filing alone should not be surprising.

Whether you are starting a business for the first time or have been running your business for years, adding "Inc." or "Corp." to your company's name can be a savvy move to protect yourself.