If you’re a new entrepreneur with a game-changing concept, you’re probably eager to get your company started. However, launching your company requires more than just a great idea for a business. If you’re looking to start a corporation (or convert an existing business into one), you’ll have to file articles of incorporation.
When you file articles of incorporation for your small business, your company becomes a corporation. Without filing your articles of incorporation, you can’t open a corporation from scratch or start a corporation from an existing LLC, partnership, or sole proprietorship.
You should ask yourself three questions before filing your incorporation forms:
To file your articles of incorporation, follow these nine steps:
You can file articles of incorporation directly with your state secretary’s office, through a legal help site, or with a lawyer’s assistance. Direct filing usually costs less money than the other methods, but if you attempt filing yourself and have questions, you may find legal help sites or personal lawyer assistance worth the spend. Once you decide, begin drafting your articles.
Your first article of incorporation is simply your corporation’s name. Write the full company name you’ve decided upon before filing.
Your second article is your primary business location, which will likely be a storefront or office. If you operate many locations, you should list your main location.
In your third article, you’ll write your registered agent’s name and address. If your registered agent is not one of your employees or owners, don’t list your company’s address – list your agent’s.
Your fourth article is a general statement of purpose. The word “general” is important – it’s best not to be specific about your purpose. Instead of detailing your products and services, use words that allow your company to change its suite of products and services. An example might be, “The purpose of this corporation is to conduct any lawful activities permitted to corporations in this state.”
If your state does require more specific language, you can still write the statement of purpose without getting into the nitty-gritty. If you’re opening a dog walking business, for example, you can write “to walk dogs and conduct any other lawful activities permitted to corporations in this state” as your general statement of purpose.
All corporations have shareholders, so in your fifth article of incorporation, declare how many authorized shares you will sell. The amount you choose can be more than the amount you ultimately issue, but your filing costs may increase with your number of authorized shares. If your state requires you to list the stock classes your company will issue, you may want to speak with an accountant about the best options for your business.
In your sixth and seventh articles, you’ll list your directors’ and incorporators’ names and addresses. You can attach extra sheets of paper to your articles of incorporation to include all your directors and incorporators.
If you intend your corporation to be permanent, then for your eighth article, write “The duration of this corporation is perpetual.” If not, write the duration and end date of your corporation.
Complete your articles of incorporation by collecting all your incorporators’ signatures and dating your articles’ final section. Now, you’re ready to file your articles.
How to decide where to incorporate your business
You can incorporate your company in a state other than your own. Consider these four factors when choosing where to incorporate your business: