Frequently Asked Questions

The C Corporation, or Standard Corporation, is the most frequent form of a corporation in use today. The C Corporation is viewed as an entirely separate legal and tax entity from its owners who are taxed as employees. C Corporations allow for profits to remain within the business or can be distributed to the shareholders (owners) in the form of dividends (which can lead to double taxation). These profits are taxed at a lower rate than personal income.

• Double taxation on shareholders (owners) personal taxes

A C Corporation’s net profits are issued to the shareholders in the form of dividends. The net profits of a corporation are received by the shareholders and are then taxed personally on the dividends. When dividends are paid to the shareholders, the double taxation occurs on their personal taxes.

• Extensive business maintenance

In order to keep in compliance with the law and maintain corporate status, ongoing paperwork must be compiled and completed. Also, holding annual corporate meetings and registering the meeting minutes.

• Limited Personal Liability

Having a C Corporation limits your personal liability to no more than that of the original investment. The shareholders (owners) of a corporation cannot be held personally liable for business claims, debts, or other liabilities.

• C Corporations typically provide a number of advantages:
• Unlimited owners
• Unlimited entity life
• Easy transfer of ownership (through the sale of stock)
• More easily raised capital (by selling shares of stock)
• Increased credibility
• Lower audit risk (corporations are audited less frequently)
• Tax deductible expenses
• Self-employment tax savings

No, an attorney is not needed to file your business or is it a legal requirement. By filing your company with us, we allow you to avoid getting billed exorbitant amounts of legal fees. However, we do not offer legal advice, and we may advise you to speak to an attorney as we deem fit.

Almost every state requires a corporation or an LLC to maintain a Registered Agent. The Registered Agent address accepts legal and official documents including but not limited to: annual reports, franchise tax notices, official legal notices (court summons), and more on your companies behalf. If a Registered Agent is not designated it may infringe on the company’s ability to gain access to the state courts and legally enter into contracts.

There are no existing citizenship or residency requirements when filing an LLC or C Corporation. However, an S Corporation restricts non-US residents from being the owner, but any resident alien may be the owner (shareholder).

Three components make up a corporation: shareholders, directors and officers. Each component serves as a fundamental role in the corporation. Shareholders elect the Directors and are the owners of the corporation. Directors make the primary decisions of the corporation on behalf of the shareholders and elect the Officers. Officers are in charge of the day-to-day operations of the corporation. These components of the corporation can be fulfilled by one person or can be divided up for many.

Bylaws are used to fulfill formalities in accordance with state corporate laws. They are not filed with the state, but instead are internal documents containing guidelines for holding corporate meetings.

Your Articles of Incorporation set the number of initial shares issued. The number of shares issued is essentially arbitrary and completely up to the shareholder.

A C Corporation is a entirely separate taxable entity. This differs from an S Corporation, LLC, and sole proprietorship as these business entities profits are passed through the owner’s personal tax return. Federal taxes of a C Corporation are paid on the net profits of the business through the filing of the 1120 form with the IRS. After-tax-profits are paid out to the shareholders (owners) in the form of dividends, or can be reinvested in the business. The taxing of Corporations differ state-to-state.

An S-Corporation is a particular type of corporation (Note: The “S” in S-Corporation refers to sub chapter S of the tax code). The formation requirements for an S Corporation are the same as those for a C-Corporation. Incorporation documents, typically called the Articles of Incorporation or Certificate of Incorporation, must be filed with the appropriate state agency and the necessary state filing fees must be paid. An S-Corporation is a corporation that has elected a special tax status with the Internal Revenue Service (IRS). After the incorporation with the state is complete, the corporation applies for an S-Corporation status by filing Form 2553 with the IRS.

• Extensive business maintenance

In order to stay compliant with the law and maintain corporate status, ongoing paperworkcontinuous paperwork must be compiled and completed. Also, holding annual corporate meetings and registering the meeting minutes must be performed. Additional Restrictions:

• S Corporations must haverequire shareholders to be who are US Citizens or US Residents.
• S Corporations number 100 or less shareholders.
• S Corporations can only have one class of stock (cannot be C Corporations, other S Corporations, Limited Liability Companies (LLCs), partnerships or certain trusts).

• Limited personal liability

Having an S Corporation limits your personal liability to no more than that of the original investment. The shareholders (owners) of a corporation cannot be held personally liable for business claims, debts, or other liabilities.

• S Corporations typically provide a number of advantages:
• Unlimited owners
• Unlimited entity life
• Easy transfer of ownership (through the sale of stock)
• Raise capital more easily (By selling shares of stock)
• Increased credibility
• Lower auditing risk (corporations are audited less frequently)
• Tax deductible expenses
• Self-employment tax savings

No, an attorney is not needed to file your business nor is it a legal requirement. By filing your company with us, we allow you to avoid getting billed exorbitant amounts of legal fees. However, we do not offer legal advice, and we may advise you to speak to an attorney as we deem fit.

Almost every state requires a corporation or an LLC to maintain a Registered Agent. The Registered Agent address accepts legal and official documents including but not limited to: annual reports, franchise tax notices, official legal notices (court summons), and more on your companies behalf. If a Registered Agent is not designated, this may infringe on the company’s ability to gain access to the state courts and legally enter into contracts.

There are no existing citizenship or residency requirements when filing an LLC or C Corporation. However, an S Corporation restricts non-US residents from being the owner, but any resident alien may be the owner (shareholder).

Three components make up a corporation: shareholders, directors and officers. Each component serves as a fundamental role in the corporation. Shareholders elect the Directors and are the owners of the corporation. Directors make the primary decisions of the corporation on behalf of the shareholders and elect the Officers. Officers run the day-to-day operations of the corporation. These components of the corporation can be fulfilled by one person or can be divided up for many.

Bylaws are used to fulfill formalities in accordance with state corporate laws. They are not filed with the state, but instead are internal documents containing guidelines for holding corporate meetings.

Your Articles of Incorporation set the number of initial shares issued. The number of shares issued is more or less arbitrary and completely up to the shareholder.

A Limited Liability Company (LLC) is a business entity that offers limited liability protection and pass-through taxation. An LLC is legally separate from its owners, and therefore the owners of LLC’s cannot be held personally responsible for debts or liabilities. An LLC also allows for pass-through taxation, meaning it is not taxed at the entity level but instead is represented on the owner’s personal tax return.

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A Non-Profit Corporation is an entity formed in order to advance a particular program without making a profit. Non-Profit organizations fall into five main categories: charitable organizations, governmental groups, political groups, social clubs, and trade associations.

No, filing your company as a Nonprofit Corporation does not make you tax-exempt from federal or state income taxes. In order to have federal tax-exempt status, Form 1023 must be filed with and approved by the IRS.

The majority of states expect a Nonprofit Corporation to have two or three directors. However, some states only require one.

There is no requirement that insists you must file you Nonprofit Corporation in the state that it will be located in. However, matters such as the state filing fees and the taxation laws governing that state may be a concern. If the nonprofit has only a few directors that will undertake most of its activities, primarily within a single state, filing your nonprofit corporation locally is often the best decision. Filing as a foreign nonprofit in the state where your business is physically located will usually result in additional fees from both the state your business is run in and your state of incorporation.

First, your Nonprofit Articles of Incorporation must be filed with the state and the initial fees must be paid. Your Nonprofit Corporation must then hold an organizational meeting, this is where the bylaws are established and the incorporation process is fulfilled. At that time documentation such as opening a bank account and other determinations of the nonprofit corporation should be recognized.

Three components make up a corporation: shareholders, directors and officers. Each component serves as a fundamental role in the corporation. Shareholders elect the Directors and are the owners of the corporation. Directors make the primary decisions of the corporation on behalf of the shareholders and elect the Officers. Officers run the day-to-day operations of the corporation. These components of the corporation can be fulfilled by one person or can be divided up for many.

Bylaws are used to fulfill formalities in accordance with state corporate laws. They are not filed with the state but, instead are internal documents containing guidelines for holding corporate meetings.

Yes, a nonprofit corporation may produce a profit. However, this profit may not be distributed to officers or directors, but may be used for operating expenses including salaries. Surpluses (profits) must be reinvested back into the organization for its tax-exempt purposes.

Processing times vary state-by-state. For a full list of state-by-state processing times, please visit this link: http://www.incfile.com/processing-times.php (list these timeframes on the site and provide the link to that page on my site)

SIDE NOTE: The filing times provided in the above link is in addition to mailing times chosen in your package during the application process.

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A DBA is a filing with the local jurisdiction (county) or the state to register an official and public business name. A DBA is also sometimes referred to as an assumed name, fictitious business name, or trade name.

Yes. In fact, many sole proprietors or partnerships that do not want to conduct business under their personal name will file a DBA with the state or within their local jurisdiction (county). Additionally, many banks will require the filing of a DBA by the sole proprietors or partnerships in order to differentiate between the business and the principal owners of the sole proprietorship and/or partnership.

A corporation or LLC files a DBA when they are conducting business under a name other than their Legal Business Name. A corporation or LLC is required to file the DBA in the state or county in which the company was formed or foreign qualified.

Filing a DBA with the state will provide you with the documents to:

• Open a bank account
• Advertise on business cards, letterhead or signs
• Collect checks and other receivables under the DBA name
• Officially use your DBA to discourage other entities from using your same name
• Use a DBA as a Domain Name (e-commerce and web marketing)
• Conduct business under a name different than the Legal Business Name filed with the state

There are no limits to the amount of DBA’s you can file with the state. Having multiple DBA’s allows your company to market and operate different businesses under the same legal entity.

It is required that you file the DBA in the state or county in which the company was formed or foreign qualified.

The usual completion time for filing a DBA with ICS is 4 to 6 weeks. DBA’s must be filed after the entity is accepted and registered by the state.

There are no limits to the amount of DBA’s you can file with the state. Having multiple DBA’s allows your company to market and operate different businesses under the same legal entity.

Filing your DBA does not necessarily prevent or restrict a third party from using the filed DBA name. In order for you to restrict the use of the filed DBA name it must be trademarked.

The expiration of a DBA will vary depending on what state you have filed in. The notification of your DBA’s expiration will be presented to your company at the time at which it expires.

DBA publication requirements vary from state-to-state. Integrated Corp. Solutions will publish the DBA on a case-by-case basis when required.

The difference between PC’s / PLLC’s and regular C Corp’s, S Corp’s and LLC’s is that PC’S and PLLC’s are organized for the purpose of providing professional services. State laws determine what classifies a business as a PC or PLLC. Typically, these professions require a license. Here are some examples of PC’s and PLLC’s: Doctors, Lawyers, Accountants, Architects, and Engineers.

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