New incorporation

Congratulations on considering incorporating your business! Here's a step-by-step guide to help you through the process:

Why Incorporate?

Incorporating your business can provide several benefits, including:

  1. Limited Liability: As a shareholder, your personal assets are protected from business debts and liabilities.
  2. Tax Benefits: Corporations are subject to different tax rates and deductions, which can reduce your tax liability.
  3. Credibility: Incorporating can increase your business's credibility and reputation.
  4. Flexibility: Corporations can issue different classes of stock, allowing for more flexibility in ownership and management.

Types of Incorporations

There are several types of incorporations, including:

  1. C Corporation (C Corp): A traditional corporation with shareholders and directors.
  2. S Corporation (S Corp): A pass-through entity with shareholders and no double taxation.
  3. Limited Liability Company (LLC): A hybrid entity with pass-through taxation and limited liability.
  4. Non-Profit Corporation: A corporation with a mission to benefit the public.

Incorporation Process

Here's a step-by-step guide to incorporating your business:

  1. Choose a Business Name: Select a unique and available business name that complies with your state's naming requirements.
  2. Appoint a Registered Agent: A registered agent is responsible for receiving legal documents and notices on behalf of your corporation.
  3. Prepare and File Articles of Incorporation: File articles of incorporation with your state's Secretary of State or similar agency.
  4. Create a Corporate Structure: Establish a corporate structure, including a board of directors, officers, and shareholders.
  5. Issue Stock: Issue stock to shareholders and maintain accurate records of ownership.
  6. Obtain an EIN: Apply for an Employer Identification Number (EIN) from the IRS.
  7. Obtain Licenses and Permits: Obtain necessary licenses and permits to operate your business.
  8. Create a Corporate Bylaws: Establish a set of bylaws that outline the rules and procedures for your corporation.

Filing Requirements

Filing requirements vary by state, but typically include:

  1. Articles of Incorporation: A document that provides basic information about your corporation.
  2. Initial Report: A report that provides additional information about your corporation.
  3. Annual Report: An annual report that updates your corporation's information.

Costs and Fees

The costs and fees associated with incorporating vary by state and type of incorporation. Here are some estimated costs:

  1. Filing Fees: $100 to $500
  2. Registered Agent Fees: $50 to $200 per year
  3. Attorney Fees: $500 to $2,000
  4. Business License Fees: $50 to $500 per year

Conclusion

Incorporating your business can provide numerous benefits, but it's essential to understand the process and requirements involved. By following these steps and considering the costs and fees, you can successfully incorporate your business and protect your personal assets.