Starting a business isn’t just “paperwork,” it’s a sequence of legal and tax decisions that create real costs down the line if you get them wrong. Let's look at the formation filings most founders encounter: what they are, what they must include, and the choices that matter in week one.
Most states use one of two names for the formation filing:
- Articles of Incorporation (for corporations)
- Articles of Organization (for LLCs)
They serve the same function: to formally register your entity with the state. Precision matters here because the details in these filings affect taxes, ownership records, and later compliance.
Immediate necessities: file your entity, then get the EIN
Form the entity first (LLC or corporation) and then apply for your EIN from the IRS at irs.gov. Applying as the wrong “responsible party” or before the entity exists can force a redo. If you plan an S corporation tax election, note deadlines (generally within 75 days of formation or the start of the tax year) after you have the EIN.
Mandatory Elements: What Must Be Included in Your formation filing
Your state requires several key pieces of information within your Articles of Incorporation (corporation) or Articles of Organization (LLC) to recognize and register your new entity.
- Choose entity type, then understand tax elections. Pick the entity (LLC, corporation, and special forms like professional entities, where required). Then consider tax elections: “C corporation” is the default for corporations; “S corporation” is a tax election available to qualifying corporations (and sometimes LLCs taxed as corporations). Terminology matters in your filing; LLCs use Articles of Organization; corporations use Articles of Incorporation.
- Identify the incorporator (corporation) or organizer (LLC). Formation filings list an incorporator (for corporations) or organizer (for LLCs). This can be a third-party service; they don’t gain ownership merely by appearing in the filing. Their role is limited to the initial paperwork.
- Selecting and Clearing Your Company Name. Clear the name at the state level (to avoid rejection) and at the trademark level (to avoid infringement). A basic “knockout” search: state registry, USPTO TESS for likely conflicts, Google, domains, and social handles. State clearance ≠ trademark clearance; trademark law uses “likelihood of confusion,” including similar names in similar industries. Overlapping names online can trigger consumer confusion and legal risk even across state lines.
- Listing the Company Address. Filings typically ask for a principal office address and a registered office address. The principal office can often be out of state; the registered office must be in the formation state (that’s the registered agent’s address). If privacy matters, don’t list your home as the principal office if public records will display it.
The Registered Agent: Your Legal Lifeline
List a reliable registered agent with a specific name and address in the formation state. Service of process goes to this address; missing it can lead to default judgments or administrative dissolution. Tradeoffs: naming yourself (cheap, less privacy, must be available during business hours) vs a commercial agent (privacy, reliability, multi‑state coverage, annual fee). You can change agents later; just file the change and keep records current.
State-Specific and Strategic Requirements
Aside from the basics that are required, your state may ask for information like:
- Purpose of business: Use “any lawful purpose” unless a license requires specificity; some states require a NAICS code.
- Directors/officers/shares (corporations): Many details belong in bylaws and initial resolutions, not in the Articles. Authorize sufficient shares up front to avoid amendment fees later; par value can affect taxes in some states.
- Member/manager (LLCs): Indicate whether member‑managed or manager‑managed; this affects signature authority.
- Fees and timelines: Expect base filing fees plus expedited options; processing varies by state.
- Foreign qualification: If you form in one state but do business in another, you’ll likely need to register (“qualify”) in the other state and appoint a registered agent there, too.
The Strategy of Anonymity
Some states (e.g., New Mexico, Wyoming, Delaware) minimize public disclosure of owners, which can preserve privacy on state websites. However, practical constraints remain: banks, insurers, and vendors. A foreign qualification in a more transparent state can also defeat anonymity. If privacy is a priority, plan structure (holding company, commercial registered agent, separate mailing address) with clear limits on what anonymity can and cannot achieve. Just because you've seen someone suggest using one of these states doesn't mean it's right for you and your company.
Do Not Go It Alone: Consulting Professionals
Speak with an accountant and an attorney before filing. Use decision drivers: number of founders, expected profits, equity compensation plans, fundraising plans, QSBS eligibility, self‑employment tax exposure, licensing, multi‑state operations, and privacy needs. Ideally, have your accountant and attorney coordinate so that tax and liability protections align.
After You File: Your First 30‑Day Checklist
You can check the video above and/or download The 4 Essential Steps to Start Your LLC the Right Way for free. Some items that should be on your radar as you get started:
- Obtain EIN (after formation)
- Adopt bylaws (corporation) or operating agreement (LLC)
- Hold organizational meeting/consents; appoint directors/managers/officers
- Issue shares/units; set up cap table; authorize sufficient shares
- Open bank account; set internal controls
- Register for state/local taxes (sales, payroll); consider S corp election timing
- Secure licenses/permits and insurance
- Calendar annual reports and franchise taxes; maintain registered agent
- If operating in other states, file foreign qualifications
Do I Need a Business Attorney?
If you need help with these steps, or have some other business legal issues you are confronting, let's schedule a Legal Strategy Session online or by calling my Edina, Minnesota office at (612) 294-6982 or my New York City office at (646) 847-3560. My office will be happy to find a convenient time for us to have a phone call to review the best options and next steps for you and your business.
