Which entity is best for me?

A Corporation or C Corp is usually appropriate if:

• There is any chance the owners might want to become an S corporation.
• Several individuals or entities will be owners.
• Owners plan to be profitable in the first several years of operation and plan to reinvest profits for growth.
• Owners live in a state with income tax.

An S corporation is usually appropriate if:

• The company will experience start-up losses during the initial years of operation and the owner has ordinary income against which these losses can be deducted.
• The company is a single-owner entity.
• The owner wants to extract most of the profits instead of reinvesting for growth.
• The company does not expect to issue multiple classes of stock or have more than 100 shareholders.

An LLC is usually appropriate if:

• The business is a partnership, or several different entities own the business.
• The company is used primarily to hold real estate or other income-generating assets such as stocks.
• The company has foreign investors.

What are state fees?

State fees are the filing fees imposed by the State for forming a Corporation, S Corporation, or  LLC in the state of your choice. The  fees for forming an entity vary by both state and entity type, so please see our State fees listing for more detailed information.

The Corporate Credibility Network acts as an intermediary by collecting the state fees you owe on behalf of the State  and submitting them on your behalf during the formation process.

How much stock do I need?

• As the owner of a corporation, you determine the appropriate number of shares for your company. The numbers of shares you select will influence your cost of maintenance. Unless otherwise specified, CCN's forms corporations with 2,000 shares at a par value of $.01. If you wish to increase the number of shares or par value later in the corporation's life, you can do so by filing an amendment with the state.

Where do I get stock/membership certificates?

• The Corporate Credibility Network's Corporate Kit contains 20 custom numbered membership or stock certificates for your company and can be purchased for an additional fee.

Do I need a federal tax ID (EIN) number?

• The IRS requires Corporations and LLCs who intend on having employees or opening a bank account to obtain an EIN. To obtain an EIN, you must provide a valid US Social Security Number (SSN) or individual tax identification number (ITIN). We have provided information on how you can obtain this online or by phone at no cost to you.

How do I open my company bank account?

• It is typically best to contact the bank(s) with which you would consider opening an account to ask them what type of information they require. Most banks require a certified copy of the articles of organization (or incorporation). Some banks will require a certificate of good standing, which can be purchased as an add-on item when ordering your company or at a later date, and a tax ID number (EIN), which we can help you obtain at no cost to you.

When do I pay annual list fees?

• For both LLCs and corporations, the annual list state fee is due to the State on or before the last day of the anniversary month of your formation. You will receive notification and instructions for paying your annual state fees from your registered agent service provider prior to that date.

Do I need to be registered to "transact business" in my home state?

• Your corporation is a Domestic corporation in the state in which it is formed. It is a Foreign Corporation in every other state or country. If you plan to staff offices in a state other than your formation state, and also for credit building purposes, it is highly advisable to register your company with that state and obtain the necessary business licenses.  This is more commonly referred to as Foreign Qualification. If you decide to register with your home state, be advised that most states will require a certificate of good standing from the state of formation. You can either order this certificate as an add-on item when you purchase your formation package, or separately later, if you find that you need it.

Do I need a Registered Agent?

• If you have chosen to incorporate in a state other than the state where you conduct business and have a business address, you will be required to obtain a Resident Agent.  This is a service that provides an address and contact for your company in the state of formation to receive legal documents and service of process documents on your behalf.  If you formed your corporation in your home state, you can act as your own resident agent and you will not be required to obtain this service.

Do I need a Mail Forwarding Service?

• Business owners who are not physically located in the state they have chosen to form their corporation often are in need of an address in that state to list as their business address. With the mail forwarding service, you are provided a physical street address (not a P.O. Box). The mail received for your company is then forwarded weekly to the address you designate. Mail forwarding is available to customers located in and outside of the United States.  While this is an option available to all businesses, we recommend exercising the Foreign Qualification option and using your own business address.