11 Steps on How to Start a Corporation in California.

5) Get in Touch with Various Agencies

Be sure to register your corporation with tax agencies. These exist in your state, and also, make sure to contact the IRS.

• The IRS will provide your business with the appropriate numbers involved in the identification
• Your state will also provide information and additional ID numbers for your business’ tax purposes
• For example, in California, you have the Board of Equalization, California Department of Tax and Fee Administration, Employment Development Department, and the Franchise Tax Board

6) Get the Shareholder’s Agreement Down on Paper

The Shareholder’s Agreement is a big part of formatting a corporation. We highly encourage you to craft an agreement and write it down. While some might suggest this isn’t necessary, this document is a measure of security. Why? The agreement ensures that shareholders are protected if, for example, there is an unfortunate event such as death. Other occasions where you will find yourself relying on your shareholder’s agreement:

• Retirement
• Transfer of ownership of shares

7) Draft and File The Necessary Articles

In order to start and form your corporation correctly, in California or elsewhere, here is what else you will need to do:

1. Get the correct articles from your state offices
2. File the articles, which can be called “incorporation” or “charter” certificates
3. Choose a contact individual (an agent) who will deal with your appropriate notices, government communications, and other required documents.

8) Find a Name for Your New Corporation

The name of a corporation is monumental for many reasons. Here are a few:

• You want people to recognize it
• You want it to be something memorable that people will take seriously
• You’d do well with a name that is catchy and easy to remember
• You’d do well with a name that really stands out!

How to Decide on a Name

Include a term that labels your corporation, for example, Incorporated, Corporation, Limited, or the corresponding abbreviations

First, identify and check in with your state regarding forbidden or words; terms that are restricted in each state differ.

Check any similar trademarks that you should be acutely aware of, lest you copy or emulate someone’s already-established business. Examples of words that have been restricted in the past are “Bank” as well as “Insurance.” There are online searches you can easily conduct for established trademarks.

Alright, so you’ve found a name that you love: it is interesting, authoritative, and also makes the consumer curious. Now is time to ask yourself a few important questions:

• Is the new name I have chosen in use by another business in my state?
• Is the name being used by a company that is located out of state?
• Did I speak with California’s correct offices in order to determine that my new name is available?
• Is this the correct name for the corporation that I am starting?
• Do I have any backup names that I could use if the first choice does not work out?
• Did I contact the California office of corporations to reserve the new name?
• Have I filed the appropriate legal articles in order to cement the start of the business and maintain the new name?

Trade Names and Assumed Names

As you can see, a business name is a large part of the process of starting a corporation. Often, businesses want to choose one ‘corporate’ name but then run their business using a contrasting name of their choice. We call this a ‘trade name’ or ‘assumed name.’

These laws are subjective and can be different in each state. They also sometimes fluctuate by county or city. We recommend you check with state and county officials and other state offices to make sure you are ready to register with what is also known as a “doing business as” moniker.

Learn more: How to Come Up with a Business Name