Forming your own business entity can be an exciting experience. However, with all the complex formation documents you’ll need to complete, it can also be exhausting, confusing, and time-consuming.
But if you take time to understand what you need before you embark on your journey, you can enjoy a more streamlined, efficient incorporation process.
In this post, we'll help you do just that. Read on as we explore the incorporation documents you need to get your corporation up and running.
Articles of incorporation, also known as a certificate of incorporation, is a business formation document filed with the state to establish a C-corporation or S-corporation. It gives the secretary of state office pertinent information about your business, such as:
Filling out this formation document is essential as it establishes your business as a legal entity. It also serves as a guide, detailing critical information like your purpose, authorized shares, and operational duration.
Some people assume that a limited liability company (LLC) must also fill out articles of incorporation. But this isn't a requirement for forming an LLC. Instead, you need to fill out articles of organization.
This document is a lot like the certificate of incorporation, but it's specially created for LLCs. You need to file it with the secretary of state's office in the area where you plan to operate your business to establish it legally. Some of the details to include are:
The corporate bylaws document details how directors, business owners, and officers will run the corporation and split control. It's basically a set of internal rules that guide stakeholders on voting and decision-making.
While not a requirement in all states, the corporate bylaws document is essential to the incorporation process as it explains the relationships between stakeholders. It also helps with conflict resolutions, promotes transparency, and ensures all parties understand the business rules.
Some of the key components in this document include:
State laws require corporations to keep records of minutes in case of a government audit. But they’re also a great internal resource, as they document all vital company decisions and promote transparency. This can come in handy during conflict resolutions and internal audits.
Corporations must take minutes during all company meetings — annual, shareholder, new stock issue, etc. The minutes should document the following:
Some best practices to keep in mind when preparing minutes include:
When your record of meeting minutes is ready, store it safely for future reference. This way, you can quickly share it as part of an annual report, during an audit, or in the event your business is involved in a lawsuit.
Form S-2553 is one of the most important tax forms for small businesses that want to elect to be S-corporations.
The Internal Revenue Service (IRS) considers S-corporations to be pass-through entities. This means that the agency doesn't tax corporate revenue. Instead, the corporation passes its taxable income and losses to shareholders, who report them on their personal returns.
On the other hand, a C-corp pays taxes on corporate income as well as shareholders' distributions. So it’s no surprise that many businesses choose the S-corp designation — it protects them from double taxation at the federal level.
Confirm if you meet the S-corp election requirements, and if so, file form S-2553 within two months and 15 days of your business's formation to enjoy tax savings.
While our checklist is a helpful guide, it doesn't cover the nuances of different state incorporation requirements, which can vary from state to state. So take time to research precisely what your state government needs.
For instance, LLCs in New York don't just need to file their articles of organization with the secretary of state. They also need to publish the document in two newspapers within 120 days of formation, a requirement that's entirely specific to this state.
Similarly, Delaware imposes an annual franchise tax of $300, which business entities must pay to remain in good standing with the state.
Navigating different states' incorporation requirements can be a daunting experience, especially if this is your first time forming a business entity. To make the process more manageable, consult an experienced attorney for legal advice.
They can guide you on local state laws and how to appropriately fill out the required legal documents to boost your likelihood of a smooth incorporation process.
You’ll need to complete the incorporation documents discussed here to legally form your corporation and remain in good standing with your state. But keep in mind there may be slight variations in the kind of information and documents required, depending on your location. So do your due diligence.
Stable can support your incorporation efforts by providing you with a permanent, professional address, mail management, and registered agent services.
We'll not only provide a real street address to include in your incorporation documents but also receive legal correspondence on your behalf and digitize your mail to allow for remote access. This means greater flexibility and convenience for you and a more streamlined incorporation process.
Ready to fill out and file your incorporation documents? Get started with Stable today for a permanent business address and registered agent services!
