Key takeaways
- If you want to form a corporation, then you’ll need to file articles of incorporation with your state.
- It’s a straightforward and simple process. But if you prefer not to file yourself, you can use a legal service website or lawyer instead.
- Filing fees vary by state but generally cost between $35 and $300.
Articles of incorporation are legal documents that you file with your state’s business filing agency to establish a C corporation or S corporation. These documents are also known as the certificate of incorporation or corporate charter. They contain basic business information, such as company address and number of shares authorized. Once approved by the state, the articles legally establish your corporation.
In this guide, we'll go over what information goes into your articles of incorporation, how to file them and the post-filing steps required to complete the launch of your new company.
What’s included in articles of incorporation
Articles of incorporation vary slightly from state to state, but most states have similar requirements. You can access your form by visiting your state’s business filing agency online. In most states, this means the secretary of state’s or attorney general’s website.
Articles of incorporation generally include the following information:
- Corporation name: This is the company’s legal name, usually ending in a corporate identifier like "Corp." or "Inc."
- Corporation address: This is your business’s principal operating address in the state where you’re filing.
- Registered agent: This is the individual or company that will receive official documents on your business’s behalf.
- Business purpose: Some states have a general statement authorizing the business to engage in any lawful purpose. But other states require a more specific description of your business’s products or services.
- Directors and officers: Some states require you to provide the names and addresses of directors and officers. Directors are responsible for overall strategy and corporate planning. They are elected by shareholders and appoint the officers. Officers, like chief executive officer and chief financial officer, are responsible for running the business on a day-to-day basis.
- Class of shares: C corps can issue different classes of stock (common and preferred). S corps are limited to one class of stock. In a C corp, preferred stock usually is designated for investors who get first access to dividends and distributions of assets.
- Incorporator: The individual or legal service company that fills out and files the form is the incorporator.
How to file articles of incorporation
There are three main ways to file your articles of incorporation.
1. File yourself through the secretary of state’s office.
This method is the fastest and most affordable option. Most states allow online filing. You just have to pay the filing fee. Corporation filing fees range between $35 (Montana) and $300 (Texas), depending on the state.
2. File through a legal help site.
Legal services sites — such as LegalZoom, Rocket Lawyer and Bizee — offer a little extra help in filing. These services walk you through a questionnaire about your business that includes all the information in the articles of incorporation. The company then completes and submits the form on your behalf. With this option, you have to pay the state filing fee plus the site’s fees. Legal services sites usually offer different pricing packages to suit your needs.
» MORE: LegalZoom vs. Rocket Lawyer
3. File with a lawyer’s assistance.
Most businesses can handle filing on their own or through a legal help site. But if you already have a business lawyer on retainer or have a more complicated situation (e.g., thousands of shares or subsidiaries within your business), hiring a lawyer can be helpful. Actually filing the articles doesn’t take long and won’t cost you much. But a consultation with a lawyer could help you avoid problems down the line.
Once you file, the state will process the paperwork and officially register the business name. You’ll receive a formal certificate of incorporation in the mail. Save a copy of this certificate as well as a copy of the articles of incorporation with your corporate records.
Where to file articles of incorporation
Most small business owners incorporate their company in the state where their office or shop is located. But you can choose to incorporate your business in any state, regardless of where your business is physically located. For example, Delaware and Nevada are popular states to incorporate because of their favorable tax laws and corporation-friendly legal systems.
These are some variables to keep in mind when deciding where to incorporate your business:
- Formation fees.
- Annual fees and filings.
- Corporate taxes and franchise taxes.
- Legal system.
- Investor preferences.
If you choose to incorporate in one state but do business in another, you’ll have to qualify as a foreign corporation in the state where you operate. This requires some additional paperwork. It could also increase your tax bill, depending on the type of corporation you form and the state in which you incorporate. You may end up having to pay state income taxes in both states.
What to do after filing
Once you've filed your articles of incorporation, you have some more work to do. Take the following steps to ensure you’re operating legally and to maintain your status as a corporation.
- File an initial report. Several states require you to file an initial report within a month or two of your incorporation. Initial reports contain up-to-date information about your business’s directors and officers, location and registered agent. In a lot of ways, it might seem like a repetition of the articles of incorporation.
- Fulfill the publishing requirement (if applicable). Some states require you to publish a notice in a local newspaper that contains your business’s name, address, number of shares and other information from your articles.
- Submit an annual report. Annual reports usually contain detailed financial data for prospective shareholders and the public. States vary in the specifics, but you typically have to submit them by March or April after the year of incorporation.
- Create corporate bylaws. Corporate bylaws contain the blueprint for running the corporation and are far more detailed than the articles. They set out the rights and responsibilities of shareholders, directors and officers.
- Hold board of directors meeting. After incorporating, hold your first board of directors meeting and document the minutes and any resolutions the board takes.
- Hold shareholder meeting. Hold and document your first shareholder meeting. At this meeting, you’ll issue shares of stock and record the transfer.
- Elect S corp status (optional). To organize your company as an S corporation, you’ll need to file Form 2553 with the IRS.
- Handle administrative matters. You’ll also need to obtain any local business licenses, apply for an employer identification number (required for corporations), and open a business bank account. You also should determine your state’s deadlines for filing corporate taxes and franchise taxes.
