Once an agriculture-based state, Arkansas’ economy has evolved and diversified to meet the needs of today’s consumer. The major economic sectors are food production, retail and health care.

The “Natural State” is the 32nd most populous of the 50 American states and is known for a plethora of cultural, economic and recreational activities. Arkansas’ image as “a special place in the American consciousness” has attracted a lot of entrepreneurial interest.

Benefits of incorporating in Arkansas:

Protection of personal assets

Business owners wishing to start a business in Arkansas can rest assured that their personal assets are protected. Corporations and Limited Liability Companies separate the assets and liabilities of the company from the personal assets of the business owner.

Enhanced credibility

Whether starting a new business or incorporating an existing one, incorporating makes a business appear more credible to potential customers, suppliers and investors. You also have the security of operating with an American company.

Ability to Open a US Business Bank Account

Forming a US company is the first step for foreign entrepreneurs who want to open a US business bank account. A bank account gives entrepreneurs access to a debit card and a merchant services account. Business owners interested in ecommerce should know that companies like PayPal, Ebay and Amazon look favorably at companies based in the United States.

Your corporate name can boost your brand

Arkansas requires that a C corporation or an LLC must not have a name that is the same as or could be confused with a business already in existence. A unique corporate name enhances your company’s reputation and also helps protect the identity of your brand. To make sure your business name is eligible check out our free corporate name search section.

Tax flexibility and benefits

The state of Arkansas gives you the freedom to choose to operate your business either as a C-Corp or an LLC. However, the type of business entity you choose determines the nature of the taxes your business will be subject to. For instance, C-corps will be charged based on business income and LLCs will be subjected to taxes based on its members personal income return.

Residency Requirements

Arkansas does not have laws that require owners or directors of Arkansas companies to live within the state. However, before your firm is legally eligible to operate, make sure you possess all the required business licenses, permits, and tax registrations. If you need help, Inc. Plan can help you with all the hassle.

Other incorporating requirements

It is mandatory for C-corps to have not less than three members. An exception can be made if there are only one or two shareholders of record. Therefore, the number of directors of C-corps can be fewer than three but not fewer than the number of shareholders. LLCs can have one or more members. The Arkansas Secretary of State doesn’t require that members to be listed in incorporation documents for either C-corps or LLCs, and there are no age restrictions imposed.

Requirements for forming an LLC in Arkansas

When forming a Limited Liability Company certain steps must be taken to keep the business in compliance on an ongoing basis.

Name requirements for LLCs

LLC names are allowed to end with the terms “Limited Liability Company”, “Limited Company” or the abbreviations “LC”, “L.C.”, “LLC” and “L.L.C.”. The terms “Bank”, “Banking”, “Engineering” and “Insurance” need a special approval from Arkansas state authorities. Also, the terms “Limited” and “Company” can be abbreviated “Ltd.” or “Co.”

LLC filing requirements

If you decide to incorporate an LLC in Arkansas then you are required to file the Articles of Organization with the Arkansas secretary of State. Additionally, Arkansas-based LLCs are required to submit an annual franchise tax report by May 1 of the year following incorporation and annually thereafter.

Required information for the Articles of Organization

The Articles of Organization must contain the name and address of a registered agent who resides in Arkansas, and who is available to manage legal and tax business documentation. For more help with the incorporation filing or for registered agent services feel free to contact Inc. Plan (USA).

LLC taxes and fees

The state of Arkansas requires foreign and domestic LLCs that have two or more members to prepare a partnership income tax return. Additionally, the revenue and expenses of LLCs with only one member are required to be reported on the member’s individual income tax return. Arkansas LLCs are not subject to taxes based on revenues, but on their members’ distributive share of the LLC income. Alternativey, you may choosethat your LLC to be treated as a corporation for federal tax purposes.

Requirements for forming a C corporation in Arkansas:

Each of the 50 American states has its requirements for incorporating. The essential requirements for C- corporations established in Arkansas are as follow.

Name requirements for C corporations

The organization names allowed in Arkansas must include the terms “Company”, “Corporation”, “Incorporated” or “Limited”, along with their abbreviations: “Co.”, “Corp.”, “Inc.”, “Ltd.”. However, the state restricts the terms “Bank”, “Banking”, “Engineering” or “Insurance” unless the company obtains an approval from the Arkansas legal authorities.

Filing requirements in Arkansas

In order to form a corporation in Arkansas, entrepreneurs must file a document called Articles of Incorporation. Additionally, the state requires an annual Franchise Tax Report, which must be submitted on or before May 1 of the reporting year.

Required information for the Articles of Incorporation

The Articles of Incorporation require a listing of the company’s authorized shares and par value, as well as the name and address of a registered agent with a physical Arkansas address. Inc. Plan (USA) can help you with the necessary filings and also with qualified registered agent service.

Taxes and fees requirements

The state imposes a corporate income tax for both domestic and foreign corporations at a rate varying from 1% – 6.5%, depending on the business’ annual taxable revenue. Additionally, the annual Franchise Tax Report imposes a minimum tax of $150 calculated based on par value of the corporation’s share stocks and its real and personal property in Arkansas. Arkansas law also requires a tax identification number (EIN).

If you are ready to get started you can fill out our application or call 1-302-428-1200 for a Free 30 Minute Live Consultation.



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