How to Form Business Corporations

If you are starting your own business, it is a great idea to organize your business as a corporation.  Forming a corporation protects your personal assets in the case of a lawsuit against your company.  Forming a corporation may seem like an overwhelming process, but it can be easily completed.

1. Choose a state in which to form your corporation.  There are no requirements that you incorporate in your home state.  Many business owners choose to incorporate in a state that has the most corporation-friendly laws.  Most corporations in the United States are formed in Delaware, as they have an easy incorporation process and many corporation-friendly laws.


2. Learn your chosen state's guidelines.  This information can be obtained from the Secretary of State.  Visit their website to gather information on incorporating in their state, including necessary paperwork, filing requirements and fee payments.


3. Choose a unique name for your corporation.  The name that you choose must be unique.  No two corporations can have the same name.  Many Secretary of State websites offer a search feature to help you create a name that is specific to your company.  Keep in mind that you are free to do business under a name other than your corporate name.


4. Decide which type of corporation you wish to form.  There are a few options when it comes to corporation types.  Most companies choose to form a C-Corporation, as this is the most traditional type of corporation.  Small businesses often choose to incorporate as an S-Corporation to take advantage of tax benefits.  You can also choose to incorporate as an LLC, or Limited Liability Company. 


5. Write your Articles of Incorporation.  You can find forms for your articles on the Secretary of States website.  Complete the form and provide all required information.  Make sure that you include the name of your corporation, and provided the address of the registered office and name of the registered agent.


6. File your Articles of Incorporation.  File the document by submitting it to the Secretary of State.  Include a check in order to pay the filing fee.