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Experienced firm in Rancho Cucamonga explains steps to incorporate a companyPosted By Whyte & Associates
Since 1956, Whyte & Associates, Inc. has been getting new ventures off to a solid start and helping established businesses protect their assets. Our team in Rancho Cucamonga provides knowledgeable guidance through all steps to incorporate a company. We have assisted many others in taking this important measure, and we can help you, too.
Why incorporate?Whether your business is a sole proprietorship just getting underway, or you have been doing what you do for a while, someone has probably said, “You really should incorporate.”
Professional image is essential in cementing relationships with lenders, vendors, associates, and potential new hires, as well as customers. The credibility of incorporation can give you a branding edge over competitors. In many cases, there are tax advantages, and incorporating protects personal assets. The business plan aspect of incorporation supports harmonious growth of your organization, and safeguards intellectual property.
Are you ready to incorporate a company in Rancho Cucamonga?Steps to follow appear straightforward, but there can be complexities depending on the nature of your business and they type of corporation you decide to form. There are regulations at the federal, state, and city level. When the paperwork is in good order, the process typically takes about six weeks.
If you decide to take it on yourself, count on an investment of time and resources to tackle:
- Compliance with local zoning and licensing laws – Some businesses such as child care and food services are highly-regulated. Your compliance must be established for incorporation.
- Naming your business – The name you choose should be unique. The California Secretary of State will not allow you to use the same name as another entity, because it may confuse consumers. Plus, it could be grounds for a trademark infringement lawsuit. Conducting a thorough name search is also helpful in taking ownership of a website domain name.
- Choosing a registered agent – This individual or entity will accept official mail (such as service of process if your company is sued), on behalf of your business. The registered agent may be an attorney or legal service with an address in this state. Alternately, you may pick an officer, director, or employee of the company who resides in California. However, if that individual moves out of state, you must name a new registered agent.
- Drafting Articles of Incorporation – This document verifies pertinent information about the company – location, shares, registered agent, and incorporator. Explanation of the corporation’s purpose includes members of the board of directors and officers of the corporation, and proposed duration of the business.
- Filing Articles of Incorporation – Documentation, along with a filing fee, goes to the California Secretary of State. It can be e-filed or sent by post.
- Drafting By-Laws – By-Laws outline the structure and management of your company. This document defines shares, voting rights, meeting requirements, and how board members and officers are selected. By-Laws also hold information about how financial transactions will be handled, and how audits and corporate records are managed. California does not require filing of By-Laws, but it does mandate that they be maintained (updated) and kept at the principal place of business for disclosure upon audit. Investors and banks may also request By-Laws.
- Setting up records storage – Decide on a designated, safe place where corporate records that show you are operating in compliance with state and IRS laws, are stored. In addition to Articles of Incorporation and By-Laws, this cache will include meeting minutes, stock transactions, annual reports, loan information, contracts, real estate transactions, and insurance policies. Records storage can be physical, electronic, or a combination of both, so long as it is organized and can be easily produced if your business is audited.
- Holding your initial Board Meeting – This gathering involves formal adoption of Articles of Incorporation and By-Laws, and election of officers (as well as a few other procedural steps). Of course, minutes must be kept.
- Comply with federal and state requirements – Now it is time to file for an EIN (employer identification number) through the IRS. You must also open a bank account in the name of the registered business entity to ensure that corporate funds are not co-mingled with personal monies. Federal and state taxes are due quarterly.
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