If you are considering incorporating your business, you have likely done a fair amount of research and planning. You have looked closely at your market and determined how you can continue generating revenue. You have probably thought about expanding your business, leasing new office space, and calculated what your adjusted overhead expenses will be. You may have even decided to incorporate your business in a state that is friendly to entrepreneurs by having low tax rates and favorable laws. Delaware is a popular choice among business owners when it comes to these factors, and it is in your best interests to learn a bit about how to form a corporation in Delaware.
Why Delaware? Well, this seemingly sleepy state on the eastern seaboard has some major draws for business owners. For one, Delaware businesses have access to the Chancery Court, which is one of the oldest court systems in the country. In Chancery Court, legal matters are not determined by a jury, but rather by judges with comprehensive knowledge of business laws. Delaware also has a reasonable corporate tax rate, and a close proximity to other major hubs of commerce on the east coast.
How to Form a Corporation in Delaware: Choosing a Name
If you are interested in incorporating your business in Delaware, you will want to know how to get started. First, you will need to decide on a name for your business. Each state has their own rules about how you can formulate a name, and in Delaware, you must include one of the following words: “Corporation”, “club”, “company”, “syndicate”, “fund”, “foundation”, “association”, “institute”, “limited”, “society”, or “union”. You can also use a suitable abbreviation for any of the aforementioned terms.
Your name must also be wholly distinguishable from any other corporations registered in the state of Delaware. You can peruse the state’s database to see which names have been taken, and you also have the option to reserve your moniker ahead of filing a certificate of incorporation.
Submitting Your Certificate of Incorporation
With your name in place, you can then get to work on assembling your paperwork. Specifically, you will need to file what is called a “Certificate of Incorporation – Stock Corporation” form with the Delaware Secretary of State. You must include with this a filing cover memo as well. Your certificate of incorporation will prompt you for some basic information about yourself (the incorporator), the address of your business, how many shares you intend to issue, and the statement of purpose for your corporation.
You will also need to appoint a registered agent. The role of this individual is to receive all service of legal process on behalf of your corporation. In addition, they can also handle government and tax correspondence. This role is often held by in-house legal counsel, though that is not compulsory.
Form Your Corporation Online
At Corporation Center, we can help you form your Delaware corporation online. By using our easy-to-complete online forms and SSL-encrypted web portal, you can file your documents in just minutes. If you would like to learn more about forming a corporation, LLC, or LLP, contact us by phone or email today.