Articles of Incorporation – The Basics of Incorporation
When you start a business, you need to take certain legal steps. One of the most important is incorporating your business. The process can be overwhelming and time-consuming, but it can also provide many benefits for your business.
Incorporation refers to the creation of a new corporation in a state, a legal entity that can do business under its own name. It can be a single-member corporation or a public company with thousands of shareholders.
Articles of incorporation are a document that describes a company’s formation and purpose. They also set up the structure of the company’s governance, record keeping and share ownership.
These documents can vary widely from state to state, so it’s helpful to get guidance on them. In most states, articles of incorporation are used to register your business with the secretary of state. 개인사업자 법인전환
Your articles of incorporation should include information such as your corporation’s purpose, name, and location. They should also list the names and addresses of all initial board members. In some states, you’ll be required to list the number and type of authorized shares your corporation is willing to issue.
The articles of incorporation should also outline the name and address of a registered agent for your corporation. This agent will be responsible for receiving official mail and other state-related paperwork on behalf of your business. They must be located in the state where you intend to operate your corporation.
A registered agent must have a physical office in that state and be available to receive official mail during normal business hours. Some states require that the agent sign a formal document as an agreement to act as your registered agent.
When you file the articles of incorporation, you’ll also have to pay a filing fee for your state. This fee varies, but is generally about $50 to $300.
Incorporation offers a wide variety of tax advantages for businesses. These advantages include limited liability for shareholders, protection from personal liability, easier transfer of ownership among shareholders, and the ability to sell shares or raise capital.
Moreover, the owners of corporations are treated as separate legal entities from their personal assets, which limits their liability to the extent that they have invested in the business. This reduces the risk of lawsuits against individual owners and allows corporations to be more profitable.
The downside to incorporating is that you must pay taxes on the profits of the company at its level, rather than on your own personal income as is the case with other business types such as sole proprietorships and partnerships. However, this can be offset by the fact that a corporation is often taxed at lower rates than other business types due to its special status as a legal entity. ps컨설팅
The main reason to incorporate a business is that it provides owners with the protection they need from business liabilities. In addition, a corporation can theoretically last forever, so it’s possible that even after the death of an owner, the business will continue on for decades to come.