Yesterday we discussed the reasons someone might want to incorporate a small business. Today, we’ll outline the process.
How to incorporate a small business in 5 easy steps:
1. Determine the state of incorporation. Usually this is the state in which you reside and in which you plan to conduct your business. Sure, there are some long-term tax advantages to incorporating in states that have more advantageous tax laws, but unless you live in those states (Delaware is a favorite) then you have to qualify to conduct business in your state of residence anyway, which is kind of like incorporating twice. Should it ever become valuable to consider the tax benefits, you can always incorporate in another state later, so right out of the gate, it’s easiest to incorporate in the state you live in.
2. Determine who will own stock. It’s easiest if that answer is “Me and my immediate family.”
3. Check with your Secretary of State or Corporations Commissioner and the federal and state trademark registers to settle upon an available business name. You can find these sources via a Google search.
3. Prepare your Articles of Incorporation – These forms are state specific, but fortunately, the Internet has made it easier than ever to find the correct form. Here’s a handy-dandy map that allows you to click on your state and be taken to the appropriate form.
4. Complete your Corporate Bylaws – This online form service can help.
5. Files these documents with your state and pay the registration fee.
Not easy enough yet? No problem. There are incorporating services available on-line that promise to make the process of incorporating a business a snap (and affordable, to boot!) Do they work? Stay tuned tomorrow as I compare some of the major players in Online Incorporations side-by-side and pick the one I’ll use to incorporate an actual business.
Certainly there is a correlation between this series of posts and our services at Outskirts Press. Yes, I could incorporate my business by going to each government website individually and finding the proper forms and filling them out and doing everything manually. But, instead, I’m going to opt to use an online service to make all that work faster and easier for me. Am I going to have to pay for that convenience? Of course, but given the amount of time it would take me to learn how to do it all on my own, the convenience and knowledge that it is being done correctly is worth the cost to me. The same can be said for self-publishing a book…