 | ||
|
Corp Info & FAQ
|
 |
C-Corporation Information & FAQsWhat is a Corporation? A corporation is a separate and distinct legal entity from it’s owners and can conduct business under it’s own name. The most general type of corporation is commonly referred to as a C-Corporation. When operated and maintained properly the owners (shareholders) of the corporation can not be held personally liable for it’s debts and liabilities. This means that the shareholders personal assets are protected and they will not be required to settle any corporate debt or court judgments against the corporation with their own money. Disadvantage of C-Corporations The main disadvantage of C-Corporations is that they are subject to double taxation. The corporation is taxed on it’s reported income or loss and then shareholders are taxed on any dividends they have received. This double taxation can be avoided by electing S-status for the corporation. Electing S-status simply allows any income or loss to pass through directly to the shareholders thus avoiding any taxation at the corporate level. What paperwork is involved in forming a corporation? Corporations are formed by filing Articles of Incorporation or Certificate of Incorporation with the state and paying the required state fees. After it is formed a corporation must adopt bylaws and general resolutions. What are the name requirements for a corporation? It is important to pick a unique name for your company. The standard applied by the state is that your name can not be deceptively similar to an existing company’s name. Further, you will be required to use a corporate indicator at the end of the name such as Incorporated, Corporation, Inc. or Corp. (i.e. My Unique Name, Inc. or My Unique Name Corp.) How long does incorporating take? This depends on many factors including which state, current filing volume and what type of service you request. Standard filings generally take about 3 to 5 weeks to be filed in most states. You can speed up the filing process by utilizing the states expedited filing procedures. How is a corporation structured? Corporations have shareholders, directors and officers. The shareholders are the owners of the corporation and are responsible for electing the directors. Shareholders also vote on resolutions, amendments and other important corporate matters. The directors are chiefly responsible for making major corporate decisions, managing the affairs of the corporation and appointing it’s officers. The officers are responsible for running the corporations day to day operations. Officers are usually given the titles of president, vice president, secretary and treasurer. Can I act as director and hold all offices of the corporation? Yes, most states allow one person to act as sole director an hold all offices. Can I be the only shareholder of the corporation? Yes you can, but you must still execute corporate formalities such as holding meetings of shareholders and directors in order to maintain corporate status and retain personal liability protection. What is an EIN? The IRS requires business entities to obtain an Employee Identification Number. The EIN is commonly known as your companies tax ID #. The EIN will be required in order to open bank and credit accounts, hire employees or set up benefit plans. Your company will use it’s tax id # much like you use your Social Security Number. What is a Registered Agent? A registered agent is a person or entity responsible for accepting official legal and tax correspondence on your company’s behalf. You can act as you own agent as long as you have a physical address in the state your corporation is formed in and are available during normal business hours. Does my state require publication of notice after my corporation is formed? There are a few states that require notice to be published in a local newspaper after an entity has been formed. Arizona, Georgia, Nebraska and Pennsylvania require publication for both corporations and LLCs. New York requires only LLCs to publish notice. In New York the fees vary greatly based on location of the business. I would like to go to the online order form.
|
 | ||
