What are the types of corporation to choose from?

When you decide to incorporate your business, there are four different business entities to choose from: C-Corporation , S-Corporation , Non-Profit Corporation , or Professional Corporation . Read more or compare business entities in our Comparison Chart .
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What is a C-Corporation?

What sets a corporation apart from all other types of businesses is that a corporation is an independent legal and tax entity, separate from the people who own, control and manage it. Because of this separate status, the owners of a corporation don't use their personal tax returns to pay tax on corporate profits—the corporation itself pays these taxes. Owners pay personal income tax only on money they draw from the corporation in the form of salaries, bonuses, and the like.
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What is an S-Corporation?

An S-Corporation is a regular corporation that has elected S-Corporation tax status. Forming an S-Corporation lets you enjoy the limited liability of a corporate shareholder but pay income taxes as if you were a sole proprietor or a partner. In an S-Corporation, all business profits "pass through" to the owners, who report them on their personal tax returns. The S-Corporation itself does not pay any income tax. Therefore, an S-Corporation elects not to be taxed as a corporation. After the corporation has been formed, it may elect S-Corporation status by submitting IRS form 2553 to the Internal Revenue Service (in some cases a state filing is required as well).
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What is a Non-Profit Corporation?

State laws distinguish between for-profit (stock) corporations and non-profit (non-stock) corporations. A non-profit corporation often involves an organization whose primary objective is to support some issue or matter of private interest or public concern for non-commercial purposes. Examples of non-profit types might relate to the arts, charities, education, politics, religion, research, sports or some other endeavor. Under the Federal Tax Code Section 501(c), a tax-exempt corporation cannot pay dividends and, upon dissolution, must distribute its remaining assets to another nonprofit group.
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What is a professional corporation?

If your corporation will be engaging in what your state might call "Professional Services," the Articles of Incorporation must bear special language and the corporation must be formed pursuant to certain statutory provisions.
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"Professional Services" according to most states usually consists of the following activities:
Medical Services
Legal Services and Representation
Accounting and Financial Services
Architectural Services

Other services may be included in this list depending on your selected state of incorporation. It is important to note that most states vary in their requirements regarding licensing of professional activities, therefore, we encourage you to seek the advice of an attorney if you fall within the "Professional Services" statute of your state.
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How do I assign a corporate officer?

Our applications allow you to name up to four officers for your corporation when you file with us. Most states allow businesses to authorize one person to serve in the three mandatory positions:
President
Treasurer
Secretary or Clerk
This person's responsibility and authority changes for each position.

The President The President has the overall executive responsibility for the management of the corporation and is directly responsible for carrying out the orders of the board of directors. He or she is usually elected by the board of directors. The Treasurer The Treasurer is the chief financial officer of the corporation and is responsible for controlling and recording its finances and maintaining corporate bank accounts. Actual fiscal policy of the corporation may rest with the Board of Directors and be largely controlled by the President on a day-to-day basis.

The Secretary The Secretary is typically responsible for maintaining the corporate records. In addition to these required officer positions, a corporation may also have vice presidents and/or assistant secretaries or assistant treasurers.
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What is a Registered Agent?

The purpose of a Registered Agent is to provide a physical address for your business so that it can accept official documents on behalf of your corporation (tax notices, annual reports, legal-process documents such as a summons, etc.).

The primary benefit of this service is that it provides a layer of privacy between you and the public. As the Registered Agent's name and address is one of public record, generally the Registered Agent's legal address will be the one listed in all official public documents.

Penalties for not maintaining a Registered Agent may include fines or revocation of business's corporate legal status. Please note that post office boxes are not allowed.
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What else after I incorporate?

To keep your business legally viable, there are a number of steps you may need to follow after you incorporate your business. For example, you may need to file an Article of Amendment if you need to make changes to your company. You also may need to issue stock or file an Annual Report, which is a requirement in most states. Our business filing experts can help you process necessary changes to your business.
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