As soon as you start your small business, one thing comes to your brain. And it’s incorporating your business. But it is important to decide whether privatization or incorporation will suit your business.
In the USA, 70 % business organizations don’t maintain incorporation. Yet, incorporation is useful and effective for specific kinds of business. Incorporation of your business will protect you from personal liability. That is you are no longer fully responsible for anything of your business.
Business incorporation is also helpful to increase the amount of investment for your business. In a personal business, one needs to invest oneself and so the amount of investment often remains poor. The share transfer is flexible and easy in incorporation business. You can easily add a new shareholder or cancel the share of a current one. To incorporate your small business, you can follow these guidelines:
Select Your Business Name:
The first and foremost step for incorporating your small business is to select a name for your business. Your business name should reflect the service of your business. It should go with the service type of your business.
Remember! The name of your business will represent your service to the people. So, choose a name that will be clear, short but attractive to your target people. Don’t think it’s quite easy! Just choosing a business name is not enough. You also need to check whether this name is available or has already been used by another authority of the organization.
What can I do for this? It’s easy and simple. You can just go to the corporate filing office or state trade register office and check the availability of the name you have chosen for your business.
It is better for you if you keep some alternative names. It will help you to avoid the risk of falling into a hazardous situation. If your first choice is not available, then go for the second choice.
Your business Location:
When you have chosen your business name, you also need to provide the required information related to your business. Here, using a location for the business is vital.
The location you will choose should be set considering the taxation, incorporation cost. Some regions will cost more and some of them will less. With this, you also need to check your business potentiality there.
This is also important to achieve people’s trust and confidence. If your business does not have any physical entity, it may fail to gain trust from your target people. You may also know about receiving government mail or mail from other organizations to you. In this case, you need a permanent address for receiving those emails and update notifications.
Type of Corporation:
There are basically three types of incorporation. You need to select any type for the incorporation of your small business. Then you can consult with someone specifically. Three types of incorporations are C Corporation, S corporation, and LLC. These three types of corporations differ from each other. Each type has some special merits and demerits.
For this, you need to know the details information regarding these types of incorporation. It will help you decide the most suitable one for your business.
Name of the Directors:
When you have finalized the business name and its category, you should declare the names of directors of the corporation. It will help you structure your business.
The names of the directors will help others know who is responsible for your business. And you also need to name the directors with specific responsibilities. If you can structure your business directors well, your business activity will run in a smooth way. Here, you may also focus on the skill of the directors. Judging their skill in a particular area, you can select him/her for performing the specific duty.
Some of the directors will possess the power of decision making. Their names are also important to finalize the list of directors for your business.
Name of the Shareholders:
You should specifically mention the name of the business shareholders. You can state their names in the articles of incorporation. It will be a document for each of the shareholders.
The percentage of each of the shareholders should also be clearly stated. It will be helpful for your business and it will also ensure a formal structure to your incorporation business.
Certificate of Incorporation:
If you can have an incorporation certificate for your business, it will be better for the future. To have an incorporation certificate, you need to go to your state corporate filing office. Your certificate will contain the name, service type, and location, etc. of your business. Whenever you can collect your incorporation certificate, you are a valid incorporate business holder from the time.
You can also name it as the recognition of your business as an incorporation one. It also acts as a license for your business organization.
Process your Data:
Having done each step well, you now need to process all the required information in a file. Necessary data should be processed in a file as a document.
Filing the required data is also necessary for further use. You may sometimes need to check information for using it in a particular situation. In that case, you will be able to find it easily from the document
Submitting the File:
If you have completed your documentation file, you are almost at the edge of finishing the whole process of incorporation. Now you need to submit the file to the state corporate filing office. When you will submit the incorporation file to the authority, they will let you know the confirmation date and probable time to publish your business incorporation.
If the file is okay from every perspective, the office will confirm your incorporation. Otherwise, they may tell you to provide the more information that is required for the confirmation of your business incorporation.
Do you want to deal with your business professionally? This guideline will benefit you a lot. But you need to prepare your own plan and scheme of work. It will be more effective for your business incorporation.
Does it sound well? Then, why late. Come forward for business incorporation with proper plan and determination. Success will visit you for sure!!