Although it's a basic first step to getting your business formally started, many first-time small business owners are intimidated by the need to file articles of incorporation for their business. If you've never had to file documents with your state before, you may think the process is expensive and time-consuming and you'll go to great lengths to avoid filing. It's one of the main reasons that you'll see a lot of corporate filings in December - a lot of businesses have opened during the year and as the year-end approaches, they realize that they never got around to the required filings with their state. You can't control part of the anxiety - the filing fees are set by your state, so they are going to be as expensive as your state thinks they should be. But the rest of the process doesn't have to be time-consuming or intimidating.
What are Articles of Incorporation?
Articles of Incorporation are the initial documents that you file with your state when you have chosen to incorporate instead of being a sole proprietorship. They can also be called a Certificate of Incorporation or a Corporate Charter depending on what state you are filing with. Even though using the plural word "Articles" makes it sound complex, it's often a page or two long, with basic information about your business like the name, address, and information on who the corporate agent is. When they've been filed with the state, your company is officially incorporated.
The content of the articles will be specified by your state. Some typical provisions that can be required are:
- What type of business it is
- Who the Incorporator is
- Company's Name
- Company's Address
- A registered agent and their address
- The purpose of the business
- Directors and officers of the business
- Number of shares
Before You File
Before you go ahead with your articles of incorporation, it's a good idea to speak with your accountant and your attorney. One of the most important parts of this process is choosing what type of business entity you are going to choose (a corporation, a partnership, an LLC) and what kind of tax elections you'll be choosing as well. Depending on what you choose, the filings with your state may be different (i.e. you don't want to file paperwork for an LLC if you really mean to create a partnership).
How Can A Lawyer Help?
Even though the articles are a short document, spending the time to figure out how to do it is probably a waste of your precious time. While you spend hours searching the web to find the right forms to use, your lawyer probably has a file filled with forms they can use and can get everything done quickly for you. Instead of worrying that you filed it correctly, you can concentrate on your business.
The Business Lifecycle
If this is your first time starting a business, you may have a few questions about the overall process of starting a business. For a quick overview of your business from start to yearly filings, check out The Business Lifecycle. If you're more of a visual learner, you can also check out a series of companion videos to the Business Lifecycle.
If you're ready to get started, or if you have more questions, let's set up a complimentary Legal Strategy Session to discuss the next best steps for you and your business.