FREE GUIDE TO FORMING AN ALABAMA CORPORATION

What you need to start an Alabama corporation:

  • Certificate of Formation
  • $100 filing fee (an additional $100 if you want the filing expedited)
  • $50 probate judge fee; in Alabama filings are sent to the probate judge
  • $28 name reservation fee
  • Corporate bylaws (you should know how your corporation will be structured before filing)

Things to know before incorporating in Alabama:

  • How long will Alabama take to form my corporation?
    It will take the state of Alabama 6 months to process your corp’s Certificate of Formation if you mail the form. This is because you sent your corporate forms to the county where your Alabama registered office is located. Most counties take 7-10 days to process the incorporation. Our county only takes one day. Then the county forwards your incorporation to the Secretary of State who takes several weeks to process the incorporation.
    We really suggest that you pay the $100 expedite fee to get your incorporation processed by the Secretary of State in 10-14 days.
    If you need a federal tax ID number, that can be obtained online immediately with the IRS.
  • How much does it cost to form an Alabama corporation?
    The total fee is $178 to form a corporation in Alabama ($28 name reservation, $50 probate judge fee, $100 filing fee). Add an additional $100 if you choose to expedite the filing.
  • Ongoing fees?
    The Secretary of State requires an annual report when an corporation files its franchise tax return. (The Alabama business privilege tax return). C corps file Form CPT. The annual report will cost $10 every March 15th, and the BPT at least $100. Alabama corporations must file an initial return within 2.5 months of their incorporation date. From that point on, the annual report is due every March 15th. Initial returns use Form BPT-IN. They cost a minimum of $100 but could be more.

Directions

Step 1: Reserve your name

Alabama is unique in that it is the only state where you must reserve your name prior to filing your Certificate of Formation. The fee to reserve your corporation’s name is $28. You can reserve your business’ name on the Secretary of State’s website. Start by doing a free business name search.

Step 2: File the Certificate of Formation

You will need to include the following:

  • You can file with our free Certificate of Formation or the form provided by the State of Alabama on their website. Start by filling in the reserved name of your corporation.
  • List the corporation’s purpose. Generally, a sentence about the type of product or service your corporation will be providing should be satisfactory.
  • The number of shares your corporation will initially issue. Use a number that is easily divisible, like 1000, or a similar number.
  • Name and address of your Alabama registered agent. Your agent doesn’t need to sign the certificate.
  • The name(s) and address(es) of the corporation’s initial director(s).
  • The name(s) and address(es) of the incorporator(s)—this is the fancy name for the person filling out the Certificate of Formation.
  • Mail the filing and the filing fees. All domestic filings in Alabama need to be sent to the probate judge in the county where the LLC is being formed. This means there are a lot of different places where you might have to send your filings for approval in Alabama. Find an Alabama Probate Judge for the appropriate mailing address. There is an approximate wait time of six months for filings not expedited. You should hear back from the Alabama Secretary of State within three days if you choose the $100 expedite option.

Step 3: Adopt your corporate bylaws

Corporate bylaws are the document that governs how the corporation operates. They do not need to be filed or sent anywhere, but at your first board of directors meeting, one of the first items on the agenda should be to adopt the bylaws. You can draft your own or use our free bylaws template.

Step 4: Obtain an EIN

Once you’ve received your Certificate of Formation from the Secretary of State, your Alabama LLC has technically been formed—but there are a couple things you need to do to make sure it remains active in its first year. First, you need to get an EIN.

Employer Identification Numbers (EINs or FEINs) are like Social Security Numbers for businesses. Once your LLC has been formed with the State, you’ll need to contact the IRS and apply for your EIN. You can apply on the IRS website and receive your number instantly, or you can file form SS-4 to get an EIN for your LLC.

Step 5: Pay your taxes

All new Alabama businesses need to file and pay their Initial Business Privilege Tax within 2.5 months of their formation date. The tax is a minimum of $100. It’s a simple form, but you’ll need your EIN to complete it.

Step 6: Run your business

With your Alabama LLC now up and running, you need to focus on running your business. To do so, you’ll likely need to do things like open a bank account in your LLC’s name, obtain city and county licenses, or receive zoning approval from your city. To learn how to do these things and more, visit our starting an Alabama business page for more information.