Many people looking to get a business started realize that a corporation is an essential step for starting any business. Unfortunately, many of these people do not know the steps required to file a corporation. Any mistakes made while filing a corporation can slow down the launch of a business. Inc. Plan can make sure all the administrative steps go smoothly.
Pick an entity type
Many people looking to start a new business are unsure if they should incorporate or form an LLC. There is no “better” option; your decision should be based on the specifics of your company.
LLCs generally have less burdensome tax filing requirements. The IRS allows company owners to file taxes for LLCs in a personal return. This is known as “pass through” taxation. Profits made by the company are regarded the same way as personal income.
Incorporation have the benefit of being able to issue stock. This makes it easier for a company to raise money through investors.
Pick a state
Deciding which state to incorporate in is a very important decision for the future of your business. This decision will influence the tax and privacy situation of your company. Inc. Plan generally recommends that companies incorporates in the business where it will have a physical presence. Foreign business that want to establish a company in the US might want to look to Delaware. Delaware does not charge corporate income tax if the business does have a physical presence in the US. If a business is looking to open a US operation it might want to look to Texas. It possible to attract talented employees in Texas because there is no personal income tax. If you are unsure of which state to form a business then contact Inc. Plan for a personal consultation.
Select a name
Each state has different rules for selecting a new business’s name. States will not allow new businesses to operate under names already taken by businesses within the state. The Secretary of State in each state usually prohibits new companies from taking names that can easily be confused with businesses that already exist.
States also have requirements about can and cannot be included in the name of a business. States generally require that a business’s name be followed by “incorporation,” “company” or “corporation.” Abbreviations of the aforementioned designations are also usually accepted. Most states restrict use of words like “bank,” “trust” and “university” without special authorization from the secretary of state. For a complete list of acceptable designations by state and to see if your desired name is available contact Inc. Plan.
EIN number – Most new businesses in the US will require an Employer Identification Number (EIN). EIN numbers serve like as social security number for a business. This unique number is attached to a business until a new owner assumes control or the company goes bankrupt.
EINs are required to get a business bank account and to get credit from banks. EINs are required by the IRS for businesses that wish to hire employees.
If you are ready to incorporate contact Inc. Plan for a free 30 minute consultation about your business. We can help find a solution that works for your business and answer remaining questions you have about starting a company.