Owning and operating a successful business is no easy task. Even though you possess years–maybe decades–of professional experience, that sort of know-how is going to have to work in concert with pure elbow grease. If you have experience in entrepreneurship, you already know just how difficult it can be to even get a business up and off the ground. At the beginning, you may be building your enterprise in addition to working another full-time job, sacrificing your spare time in order to develop a thorough and comprehensive business plan. You will also need to crunch the numbers on your overhead costs and profit margins, in addition to making hiring decisions and developing a marketing plan. Another factor you may want to consider is how your business should be legally structured. By giving your business a legal designation, you may be able to better position your organization for future success. Of course, there are a number of ways in which you can accomplish this, but if you are thinking big and looking to grow, forming a corporation may make a lot of sense. By filing your corporate documents online, you can also save yourself valuable time.
Every business will have its own needs and goals. When you set out to give your business a legal structure, it is important to think about the big picture, in both the long- and near term. If your business is a relatively small operation, perhaps conducted from your home office or garage, you may find that a sole proprietorship suits your needs. Some find that a general partnership (GP) allows them to work together with like-minded colleagues in order to build a successful enterprise. While a GP occurs whenever two or more individuals go into business together (sometimes made official with a simple handshake), there are also more formal versions of this arrangement, such as a limited liability partnership (LLP). In some cases, though, it makes the most sense for a business to incorporate by submitting corporate documents. When the average person thinks about the word “corporation”, they may think about huge, multinational conglomerates, but small- and medium-sized businesses can also form corporations, and as you will learn, there are valid reasons for doing so.
A Quick Background on Filing Corporate Documents
So, you have successfully launched a business. You have a number of regular clients or customers, and you have found yourself very busy in a positive way. Still, you need additional resources to better manage your company, whether that means hiring more employees, broadening your marketing strategy, or even opening a new location. There is one problem, though–you lack the capital at the moment to do so. When you form a corporation, you are granted the ability to issue shares of ownership to outside investors. This allows you to generate much-needed cash while allowing your investors to gain a stake in your success. This is one selling point for corporations that business owners find appealing, and if this sounds like a good fit for your business, you may want to think about preparing corporate documents.
By definition, a corporation is its own legal entity, distinct from that of its owners (which are called “incorporators”). A corporation can enjoy many of the same privileges and rights as an individual person, in that it can pay taxes, hire employees, purchase real estate, and borrow money. A corporation can also grant its incorporators the protection afforded from limited liability. This means that should a lawsuit arise, or if your company goes bankrupt, you and the other incorporators will be able to shield your personal assets from any potential legal action. To put it in more succinct terms, if your business goes bust, you do not need to fret about losing your home. As this removes a great deal of risk from the process of starting a business, forming a corporation has an understandable allure.
Certain corporate structures are also known as “pass-through” entities to the Internal Revenue Service (IRS). As a pass-through organization, your corporation can pass deductions, credits, gains, and losses to its incorporators. When executed correctly, this can allow you to avoid paying taxes “twice.”
Filing Articles of Incorporation Online the Easy Way
To make your corporation official, there is a general process to follow, though it can vary a bit depending on the state in which you are incorporating your business. You will typically need to select a corporate name that has not already been registered in your state. This name should be included on your articles of incorporation, which is the document you will file with your Secretary of State’s office. This document should also include the address of your business, some information on its incorporators, and the number of shares that you plan to issue.
At Corporation Center, we make it easy to submit this document online. Simply select your state from our side navigation menu and you will find the fillable form that is right for you. If you have any questions about our services, please contact one of our customer service agents by phone or email today.