Forming a For-Profit Business CorporationThere are several considerations to take into an account before and during the initial phase of forming your Corporation and what type of Corporation to form. It is also extremely important to note that a well-organized business plan prior to forming any type of business entity is probably the most pivotal step in the initial development of your company. Once your business plan is developed you are ready to begin the process of legitimizing your Corporation.
Your first step is to determine which state you wish to setup your Corporation. Often it is the state where your principal place of business will be located or where you will be conducting the majority of your business transactions. It is important to note that although a Corporation may have two domiciles in different states, that if you file in one state and operate in multiple states that you will often need to register the Corporation as a Foreign Corporation in the states where you are operating, as well as secure a Registered Agent in each state, as a physical location is necessary in order to serve process (a P.O. Box is often not legally sufficient). Once this location is selected, you will file your Articles of Incorporation (or Nonstock Articles of Incorporation for a Nonstock Corporation) with the appropriate division of that state's Secretary of State. In Virginia, the Articles of Incorporation are filed with the Commonwealth of Virginia's State Corporation Commission.
The Articles of Incorporation ("Articles") is a document which outlines the purpose, structure, and Directors (may be elected thereafter) of the Corporation. The requirements for filing, including initial fees payable to that state's respective agency, vary from state to state. It is extremely important to consult a skilled business attorney, preferably one also knowledgeable in intellectual property law, who can assist you with these filing requirements as well as assist with a general business name search and trademark search which can help insure that: (1) your business name is not already in use and (2) you are not infringing upon another business entity's Trademark. It is important to note that when filing your Articles with a state agency that they often accept the name of your Corporation as you label it so long as there is not another entity with the same name filed in that state and that it is not grossly obscene in nature. However, this acceptance is not federal and may lead to future, federal Trademark claims.
Bylaws: Internal, Governing Document for a CorporationThe next step after your Articles have been approved by the appropriate state agency is to have a skilled business attorney draft the mandatory Bylaws on the Corporation's behalf. The Bylaws are a comprehensive, internal document, a copy to be kept at the Corporation's principal place of business, of the Corporation that describes in detail such considerations as the structure and governance of the company, how the company is operated, shareholder disputes, dissolution procedures, voting rights, duties and responsibilities of Directors, and indemnification clauses.
After your Bylaws have been drafted, approved, and signed, it is important register for an Employer Identification Number (EIN), also known as a Federal Tax Identification Number, with the IRS. A skilled business attorney, or tax attorney, can file an EIN on your Corporation's behalf by having you sign a Form SS-4 authorizing the attorney as a Third Party Designee to act on your behalf. The EIN will not only be used for tax purposes but to open bank accounts in the Corporation's name as well as for employee tax withholdings. It is also important to note that if your Articles were filed in the Commonwealth of Virginia you should register your organization with the Virginia Department of Taxation.
The Attorneys of McClanahan Powers, PLLC are skilled business and intellectual property attorneys and provide all services listed above.
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