Start a Corporation
Everything You Need to Know About Incorporation
Learn how to start your corporation the right way! Want to form your corporation yourself? Or hire us to incorporate for you? No matter which path you choose, you’ll find the easiest way forward with our pro tips, tools and resources below.
3 Ways to Incorporate
The fastest, easiest way to incorporate? Hire us. We form your corporation and give you registered agent service, Privacy by Default®, free mail forwarding, and the guidance of local experts. Choose our Corporate Guide Service for monthly financing—and start out for less than the cost of state fees.
Prefer to incorporate on your own? Our free account has tools to walk you through first steps. Our state pages give you all the state-specific info you need. We go over all the basics below.
How to Incorporate a Business
1. Designate a Registered Agent
You”ll list your registered agent and office in your incorporation paperwork. Your registered agent must be regularly available to accept your corporation’s state and legal mail at a physical location in the state (a registered office). This means that if you opt to be your own registered agent, your name and home or office address will become part of your corporation’s permanent public record. Hiring a registered agent service can help you keep your personal information more private.
Find everything you need to know about Registered Agent Service for your corporation.
2. Name Your Corporation
Your corporation will need a name that is distinct from other business entities registered with the state. Fortunately, every state has an online database you can search to find an available name. The available name will belong to your corporation once the state has approved the Articles of Incorporation. You are not required to reserve a name prior to filing, unless you’re forming a corporation in Alabama.
Check the availability of your corporation’s name with a Free Business Name Search.
3. Submit Articles of Incorporation
To officially create your corporation, you need to complete and submit a document (most commonly known as “Articles of Incorporation”) with the state. Each state has a unique set of requirements for Articles of Incorporation, but generally your articles will need to include your registered agent information, corporation’s name, share information and signature.
We offer a free template for creating Articles of Incorporation.
4. Get an EIN
Your corporation will need to get an employer identification number (FEIN or EIN) for its federal tax filings, and you’ll likely need an EIN to open a corporate bank account, apply for state licenses and permits, and more generally to establish your corporation’s credibility with potential clients and vendors. You can apply for an EIN by filing Form SS-4 with the IRS online, by fax, or by mail.
Everything you need to know about getting an EIN.
5. Write Corporate Bylaws
Corporate bylaws are the documents that lay out how your corporation functions. Your corporation’s bylaws should answer such questions as how long a director’s tenure lasts, which responsibilities belong to each officer, what restrictions are placed on shareholders’ voting rights, and any other details needed to effectively manage your corporation. You typically won’t file your corporate bylaws with the state, but they remain your corporation’s most important internal document.
We have free templates for your Bylaws.
6. Hold an Organizational Meeting
An organizational meeting is the first official meeting of your new corporation (and typically required by state statutes). At this time, your business adopts bylaws, issues stock, appoints officers and conducts any other setup required for your corporation. You’ll need to record meeting minutes to document actions taken and keep them with your corporate records.
Need documents for meetings? We offer free Corporate Forms for everything from resolutions to meeting minutes.
7. Open a Bank Account
Once you incorporate your business at the state level, your corporation becomes a distinct legal entity in need of its own business bank account to keep its income and assets completely separate from those of its shareholders, officers, and directors. Opening a corporate bank account usually requires a few key documents: your Articles of Incorporation, corporate bylaws, and EIN. Some banks will also want a board-approved resolution authorizing someone from your corporation to start a bank account in the organization’s name.
Make sure you have all the documents you need. We offer a free board resolution to open a Corporate Bank Account.
8. File State Reports & Taxes
After you form your corporation, you will need to file annual, biennial, or periodic reports (depending on your state’s requirements). There reports keep your corporation’s information updated on the state’s records. Some states also require corporations to file an initial report shortly after you incorporate your business. These reports are usually pretty simple, but, for whatever reason, thousands of companies neglect to submit them every year and fall out of good standing with their states. Corporations also typically file federal corporate income taxes—and many states also have a state-level corporate taxes, and potentially franchise taxes or other filing requirements.
Learn more about Business Renewals & Reports.
Why Have a Registered Agent Form Your Corporation?
You have choices when it comes to how you incorporate. So why do professionals choose to hire registered agent services like Northwest Registered Agent to form their corporations?
Time is money—and professionals know where to look for speed and competence without extra fees. At Northwest, we have registered offices in every state. We know the people in each state’s Corporate Division. We know the fastest filing methods. And when you hire us to incorporate, we use our knowledge to provide you fast, professional service.
As your registered agent, we’re able to list our registered office throughout your formation documents—as your principal office, directors’ business address, etc. We don’t list your personal info on filings if we don’t have to. Why? At Northwest, we practice Privacy by Default®, providing you a level of privacy you can’t get filing yourself or with a standard filing service.
Free Mail Forwarding & Business Address
We already accept your legal mail—so why not take it a step further? In every state, we include limited digital mail forwarding for your regular mail too. And, you can list our address as your business address. With both mail forwarding and a business address included, you get a level of security unmatched in the incorporation industry.
We know the ins and outs of each state—and we use this knowledge to help you when you need it most. Our team of Corporate Guides® has over 200 local business experts dedicated to helping you. You can call or email us for all your toughest business questions.
Select a State:
How Our Service Works
Starting a corporation can be a pricey investment—especially in states with steep filing fees. That’s why Northwest gives you two different payment options for incorporation:
With our regular incorporation service, you pay the state fees and our service fees upfront. This includes a full year of registered agent service, free limited mail forwarding, bylaws, and free forms and tools.PAY IN FULL
Corporate Guide Service
This service includes an EIN plus all the same benefits as our regular, pay-in-full incorporation service. With our Corporate Guide Service, however, you pay a small monthly fee instead of a larger upfront fee.PAY MONTHLY
Once you’ve picked your payment option, hiring us is just a few easy steps. Here’s how it works:
Choose one of the buttons below, answer a few basic questions about your corporation, and submit your payment.
We prepare and file your Articles of Incorporation and send them to the appropriate state agency for approval. In the meantime, you’ll have immediate access to your online account, where you can find useful state forms, pre-populated with your business information.
As soon as the state approves the filing, we notify you that your corporation has been legally formed. Now you can take next steps, like holding your first meeting and opening a bank account.
What is a corporation?
A corporation is a business with a legal existence separate from its owners or members. If properly maintained, a corporation can conduct business in its own name and has many of the rights and obligations of a natural person, including the ability to enter into contracts, sue and be sued, hold assets, and pay taxes in its own name.
Corporations can be formed for for-profit purposes or nonprofit purposes (or a combination of the two, as with a benefit corporation), but the majority of corporations exist mainly to benefit and enrich their shareholders. The corporation’s independent legal status ensures that shareholders’ personal assets, apart from their investments in company stock, aren’t usually on the line if the corporation gets sued or can’t pay its debts.
Not sure if a corporation is the best option for your business? See our LLC vs Corporation page.
What are the different types of corporations?
There are many different types of corporations. In addition to your standard, for-profit stock corporation, below are a few of the most common corporation types:
Professional corporation: State-licensed professions, like doctors and lawyers typically must form a professional corporation.
Nonprofit corporation: Businesses that have a purpose other than profit (such as public, mutual or religious benefit) can form a nonprofit and may be able to qualify for tax-exempt status.
Benefit corporation: Kind of a “light” nonprofit. Benefit corporations don’t qualify for tax-exempt status and can make a profit, but they have an educational, environmental or other socially beneficial purpose in addition to profit.
There are also private vs public corporations. Most corporations are private. Taking a corporation public (so that it can be listed on national stock exchanges) is a difficult and expensive journey, but it has the potential to pay off in a big way.
If you’ve heard the terms “S corp” or “C corp,” note that these aren’t actually kinds of business entities. These are different designations the IRS uses to classify how a business is taxed.
Who owns a corporation?
Corporations are owned by their shareholders and usually managed by a board of directors. The shareholders or the initial incorporators elect the directors. The directors then elect officers like a President, Vice President, CEO, CFO, Secretary, or Treasurer, all of whom have fiduciary duties to their shareholders, although a single person can also serve all of the roles in a corporation.
Shareholders have the right to vote in the corporate meetings because of the shares they own for investing their money in the corporation, but the votes of most individual shareholders usually have very little power and influence in publicly-traded corporations because of the vast number of corporate shares issued and owned. Private corporations, however, typically have only a few shareholders, and the corporation’s founder usually holds 51% of the shares to maintain control of the company.
How are corporations taxed?
By default, corporations are classified by the IRS as C corporations and taxed separately from their owners, which results in the so-called “double tax”—probably the least popular feature of the corporate business structure. The double tax is an informal term for how C corporations pay taxes on their profits before distributing those profits to shareholders. The shareholders then pay taxes on that money again as personal investment income.
Qualifying corporations, however, can elect to get taxed as S corporations (an option that is also available for LLCs). With the S corp tax election, a corporation’s profits pass through the company, get divided up among its shareholders, and get taxed only once as the shareholders’ investment income.
What is a corporate resolution?
A corporate resolution is an internal record showing the corporation’s approval of a major business decision. For example, if your corporation enters into a contract or buys property, this action should be voted on, approved and recorded in the corporate record book. While resolutions are internal, they can be audited by the IRS or state agencies, so it’s important to maintain proper records.
At Northwest we offer a variety of free resolution templates and other free Corporate Forms.
What is a corporate officer?
Corporate officers conduct the day-to-day business of a corporation and put the actions and policies established by the board of directors into action. Below are the most common corporate officer positions:
CEO or President: This is the person in charge, and they oversee the daily operations of the company. They are also responsible for delegating tasks to other officers and even employees. They can be responsible for signing important documents such as major contracts, legal documents, and stock certificates.
Treasurer or Chief Financial Officer: This person is essentially in charge of funds within the business. If you operate a smaller corporation, then this person deals with all financial aspects including payroll and billing. In a larger corporation, the CFO would do more oversight of financial operations within the company.
Secretary: The secretary of your business keeps corporate records and prepares minutes of the board meetings as well as shareholder meetings.
How much does it cost to start up a corporation?
Around $100 on average. States set their own incorporation fees. Most states have a flat base fee ranging from $45 (Arkansas online filings) to $300 (Texas). However, some jurisdictions (DC, DE, MA, MI, MO, NE, OH, OK, RI, and VA) have a fee scale that depends on factors such as number of shares or authorized capital. In DC, for instance, filing fees range between $220 and $1650, depending on the value of authorized capital.
You may also have to file an initial report and business license application upon incorporation which can significantly increase costs. In Connecticut, the filing fee is $250, but the initial report requirement brings that up to $400. In Nevada, articles are only $75—but the mandatory business license and annual report bring the total up nearly tenfold to $725.
At Northwest, we can form your corporation for just $100 plus state fees. Or, with our Corporate Guide Service, you can pay a low monthly fee and get started today for a fraction of the cost of state fees.
What are fiduciary duties?
For board members and officer, fiduciary duties are obligations to act in ways that support the corporation and shareholders. Generally, fiduciary duties include:
- Duty of Care: This legal principle states that directors and officers must act in a reasonably prudent manner. Violations generally requires gross negligence. A careless business decision that results in a loss of profits is not typically a violation.
- Duty of Loyalty: This duty requires that directors and officers act on behalf of the corporation without personal economic conflicts. A classic violation of this duty is insider trading.
- Duty of Good Faith: Good faith means that directors and officers must act in conscious regard to their fiduciary responsibilities. It includes advancing corporation and shareholder interests, not violating the law, conducting business honestly, and fulfilling all duties.
Board members or officers who breach duties can be sued for damages or even face criminal charges. Two major kinds of breaches include:
- Corporate Nonfeasance: The failure to act when under the obligation to do so.
Corporate Malfeasance: When a director or officer engages in a wrongful or illegal act.
What is an incorporator?
An incorporator signs and submits the articles that legally create your corporation. Incorporators don’t have to be anyone in your corporation—just someone you authorize to file your articles.
Because incorporators typically have to provide personal information (including address) hiring an incorporation service can help reduce excessive personal information on your articles. When you hire Northwest, we’ll be your incorporators.
Why choose Northwest to incorporate my business?
You want a free business address you can use throughout your public filings, instead of always listing your personal address.
You need a registered agent, corporate bylaws, business address and mail forwarding—all of which is included with our incorporation service.
You want fast, expert service without extra fees.
You have a lot of business questions our Corporate Guides® can answer for you.
You’re tired of companies selling your data.
- You want to spread out payments instead of paying steep filing fees all upfront.
You want to focus on your business, not filing paperwork.
Whatever your reasons are, Northwest is here to help you start your corporation the right way.