7 Steps to a Business Incorporation Filing

A Business Incorporation filing is a large undertaking.  But, it can be done if you follow seven key steps.

• Choose a business name that complies with your state laws
• Appoint your board of directors
• File Articles of Incorporation
• Write corporate bylaws
• Hold your first board of directors meeting
• Issue stock certificates
• Secure all required licenses and permits

Incorporation filing begins with choosing an available business name.  Good incorporation services offer a free business name search.  Always check with your state’s corporation division office for specific rules but, some guidelines are:

• Your corporation name cannot contain any word that suggests your business is associated with the federal government such as, National, Reserve, Federal or United States.
• You business name should end with a corporate designator or its abbreviation.  For example, corporation or corp., incorporated or inc. or limited or ltd.

In some states, for a fee you can reserve your corporate name for a short period of time while you are filing for incorporation.

The next step in incorporation filing is appointing directors.  Owners often appoint themselves as directors but can choose to appoint others.  Directors are responsible for most major policy and financial decisions for the corporation.  The number of directors allowed varies by state.  Some states allow only one director regardless of the number of owners while other states require multiple directors when there are multiple owners.

The third step is filing the Articles of Incorporation.  Although it sounds complex, it does not have to be a difficult task.  This can be done by filling out a form and paying a filing fee at your state’s corporate filing office or with the help of an incorporation service.  The form requires basic information about the corporation such as, it’s name, main address, directors and registered agent (often a director).

The next step of incorporation filing is drafting bylaws.  The bylaws are the corporation’s rules on how you will govern your operations day to day.

After drafting bylaws, you will need to hold your first board of directors meeting.  A typical agenda for this first meeting may include:

• Adopting bylaws
• Appoint corporate officers
• Determining the corporation’s fiscal year
• Authorizing stock issuance

Issuing stock can be one of the more complicated tasks due to complex securities laws.  Large corporations must register their stock with the SEC while most small corporations qualify for an exemption from securities registration.

Obtaining the appropriate licenses and permits is your next critical step.  The types of licenses and permits your corporation will need will depend on your business but could include:

• A tax registration certificate
• A seller’s permit from your state
• An employer identification number from the IRS

Incorporation filing can be complex.  Be sure to utilize you web resources such as, on-line incorporation services or your secretary of state’s office.

 

 

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