Below is a step-by-step checklist for how to incorporate your business in any state.
This is a process you can complete yourself if you don’t want to hire an attorney or a business formation service.
Although the details can differ from state to state, the basic outline of the incorporation process is the same.
1. Find a Name
The first step to incorporating your business is making sure your business’s name is available. Fortunately, all 50 states have online databases where you can find out if your proposed name is already in use. This search option can be found on your secretary of state’s website (or the website for the corresponding agency tasked with forming businesses in your state).
Once you’ve landed on the site, run searches until you find a name someone else hasn’t taken (hopefully, you don’t need to run more than one search).
Helpful Tip: Most secretaries of state websites offer the option to reserve your business’s name, but this isn’t typically required (except in Alabama). In fact, reserving your business’s name may slow down the incorporation process because you’ll be required to provide proof of your name reservation prior to filing your other state documents.
2. Create Your Governing Documents
If you’re starting a corporation, the governing documents are called corporate bylaws. For LLCs, the documents are called LLC operating agreements.
Bylaws and operating agreements are typically not filed with the state. They are for internal use and serve as formal guidelines for how your company will handle disputes, ownership percentages, dissolution, losses, profits— everything.
If your company or corporation has two or more owners, these documents will be especially vital. Be sure to sit down with your fellow co-owners to get clear about what your organization’s bylaws or operating agreement contain.
Helpful Tip: If you pay an attorney to create your corporate bylaws or LLC operating agreement, it won’t come cheap. Fortunately, there are free corporate bylaws and LLC operating agreement templates available online that you can adapt to the needs of your business.
3. File Your Paperwork
This is the step that will actually form your LLC or corporation with the state.
On almost all state websites, you will be able to download a PDF copy of the articles of incorporation (commonly called articles of organization if you’re forming an LLC), but you can also file online in most states. Either filing option will include step-by-step instructions for how to complete and submit the form.
There are generally five ways to submit your articles (though not all of these options are available in every state): in person, by fax, by email, or online. Your secretary of state’s website will identify which options are available in your state. Most states will process in-person, online, and faxed, which are faster than filings submitted by mail.
The information required in the articles varies by state. Typically, you’ll need to list basic information like your company’s name, mailing address, registered agent name and address, purpose, and the names and addresses of your corporation’s directors and/or officers or your LLC’s members and managers.
Even if you get confused while filling out the articles, do not leave any section blank. Instead, call the agency in charge of forming business entities in your state (usually the secretary of state’s office). They have paid staff who can answer whatever questions you have about filling out the form, so long as answering the question doesn’t constitute giving legal advice.
When the state has accepted your filing, it will send you a certificate or a receipt (depending on the state) that confirms your business’s legal existence.
Helpful Tip: If you need your corporation or LLC formed in a hurry, you can usually pay the state an expediting fee for a faster turnaround. Many states also process online filings instantly.
4. Hold a Meeting
One of the main goals of your organization’s first official meeting is to document the funding of the LLC or corporation. You’ll need to record the names of the people who exchanged money, assets, or services for partial ownership as well as the percentage of the company each person owns.
This documentation typically appears on the operating agreement for LLCs and in the bylaws for corporations. LLC members can receive membership certificates, and corporations can issue stock certificates.
Wrap up the meeting by having everyone relevant sign the bylaws or operating agreement and any initial resolutions (such as a resolution to open a business bank account) necessary to get your business up and running.
5. Obtain an EIN
Most businesses need a federal employer identification number (EIN or FEIN). Fortunately, the process of obtaining an EIN is painless (and usually instant) if you apply for an EIN online at the IRS website.
The form is short, and the information required to complete it is fairly simple. If you know your social security number, what kind of business entity you formed, and your fiscal calendar year (which usually begins on Jan. 1 and ends on Dec. 31), you should be fine.
6. Continue Building Your Business
If you’ve completed all the steps above, congratulations are in order: you’ve incorporated your business.
Helpful Tip: After forming their first corporation or LLC, many people look at the piece of paper received from the state and wonder if forming a corporation or LLC is really that easy. Rest assured, the answer is yes.