11 Steps for Incorporating A Business
This article provides an explanation on how corporate attorneys go through the process of incorporation.
This article provides an explanation on how corporate attorneys go through the process of incorporation.
You have now reached an important and advantageous moment in the life of your burgeoning business—it is time to incorporate a business! Here, we are going to give you a brief yet detailed summary of how to incorporate it. You may be wondering: what is the best and easiest way to incorporate? Is this the right step for my corporation right now? What are the most important aspects of incorporating my business?
Don’t worry; we’ve got you covered. Making this decision is different for everyone, but chances are, if you are contemplating this step, it is the right time. There are many advantages that can come from incorporating, and we will outline a few of those below and in further articles.
Making sure that you are prepared to incorporate is key, so read on for some tips that we have culled from our years of experience in the business world.
For only $850, our corporate attorney can incorporate your business in California which includes the following:
When you incorporate your business, it means that the corporate entity is separate from yourself as an individual, under the law. Your corporation can now:
One of the overriding advantages that go along with becoming incorporated is that your business will now become its own organization. What does that mean? It simply means that your business will be an independent entity that is now separated from an individual by law. Great news: there are advantages that come along with this. But first, you’ll need to choose the structure or arrangement that is right for your specific business; after all, all businesses are unique.
There are two major corporate structures to consider. The first is an LLC or Limited Liability Company.
An LLC is simply a specific way of structuring a business or corporation. The key takeaway here is that this arrangement will shelter its owner or owners from their sense of responsibility for incurring debt or liability. This separation of the individual from the company is advantageous, then, because if your company suffers at all, your personal finances may not. Known as hybrids, LLCs combine the individualities of a corporation with those of a sole proprietorship or what you may know simply as a partnership. An LLC has members and these members:
You may have heard of a small business that began as an LLC and then developed more completely as the years went on.
You build an LLC when you first contact your state offices in order to designate articles of organization, a formal legal document you may or may not be familiar with. These articles recognize:
You may have heard that you do not need an operating agreement to start an LLC, but we do recommend that you consult with our business attorneys in California. An operating agreement will help to simplify things as you start your LLC and can help you with:
Perhaps you do not think that an LLC is a right choice for your company as you take the first important steps to become incorporated. What are some of the other ways in which to incorporate your business?
First, you have the option to embrace the S corporation format or the C corporation format. Let’s break down some important differences between the S corps and C corps, so you know what you’re getting into.
If you are unfamiliar with pass-through or flow-through taxation, check this out:
Pass-through taxation simply means that a flow-through business pays zero taxes. Instead, a ‘control person’ pays the corporation’s taxes through that individual’s tax return.
Pass-through or Flow-Through Taxation typically applies to:
If you are wondering how to incorporate a business, here are a few more important steps you should be aware of.
A business lawyer can help you establish your business’ articles, and they will:
Be sure to check in with the state of California (or your chosen state) so that you have all of the information deemed necessary. Also, make sure to plan for a meeting of shareholders to go over:
One more detail to consider: we recommend you focus on your bylaws. These seemingly inconsequential details can become important, and many corporations deem them required. Bylaws can cover:
We will cover Articles of Organization more specifically and in-depth later, but in case you are wondering, these articles should include:
The question of how to incorporate your business includes many specific choices, and this is one of them. Location matters, and it may dictate the success of your business.
As we’re sure you know, over the last few years, the concept of “office space” has begun to change dramatically. This does not mean that you won’t want to find an office for your corporation, but it does mean that you should weigh your options carefully and do what makes sense for your specific business. Trends come and go, so make smart, informed choices.
To stay within your state and government rules when you become incorporated, you need to have a distinct physical address for your business. There are also regulations and codes you’ll need to adhere to.
If you are just starting out, you may be searching for inexpensive options or a location that can grow with your new business that has just become incorporated. Some options that might be feasible right away range from:
If you already have a larger, more established business, here are some tips:
There are more options now for choosing the right location than there ever were before. From pandemics to the tech revolution, our workspaces have always been dramatically shaped by social, cultural, and even political factors. However, the fact remains: you do need a physical embodiment of your business. The choice of where and how you do this is completely up to you!
One of the most important steps in your business becoming incorporated is selecting your business name. This can be a fun and creative process, but naming your business also has a great sense of practicality.
What sort of requirements do you need to deal with as you pick your name? While we can’t name your business for you, here are a few brief tips:
We spend most of our working days online, regardless of our occupation. Your chosen name should match with a domain name or align closely. Companies such as Bluehost, Domain.com, SiteGround, Network Solutions, and others can help. While you are at it, what are you going to call your website? You might check how your name syncs up with this, too.
As your business is becoming incorporated, you need to give it a name. Here are some general tips to help with the process.
Here’s an example: What does a business called “Cheap Tickets Fast” do? Do you want more detail or less?
Whether creative, conservative, or somewhere in-between, the name you choose is all your own. When you are wondering about how to incorporate a business, naming your enterprise is one of the main steps.
Now is the time to establish a bank account for your original corporation. Here is what you will need.
Why is a trusted and knowledgeable accountant so important? In the same way that our trusted and helpful corporate lawyers are here to help you with all your legal questions, your accountant will aid you in making integral decisions that may impact the eventual financial health and profits of your corporation. These include:
There are a plethora of business-oriented corporate banks to consider. Make sure you choose a trusted option for your business costs and expenses. Why is a corporate bank so crucial for the health of your business, especially as you incorporate?
Corporate Banks:
An important part of incorporating your business is becoming familiar with EINs. How do you find this mysterious number? Easy: you can apply online; just pull up the IRS website.
If your corporation does not include additional employees, you still need an EIN so that the IRS is able to keep track of your new business. This is nothing to be afraid of, just a necessity of security measures.
Our California corporate attorneys & business lawyers at Nakase Wade can help you, and your business makes sure you are in ideal shape as you figure out exactly how to incorporate your business.
Different states will, of course, hold and enforce different requirements, so be sure to check in with state officials and local government, as you incorporate. Regulations will not only depend on the location but on the structure and type of your company.
If your corporation is of a larger size, consider:
Normal, expected permits and licenses can include:
Check with California’s division of small businesses, and do not forget about using the resources on the website for the Department of Corporations.
Learn more about: Business | Corporate | Employment
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