In general, how does the Incorporation / LLC filing process work?
What are the exact steps in forming and filing an Incorporation or LLC?
In this audio snippet, you'll hear about:
- First, figure out what you want to do
- Make a decision on what state you're forming in
- Fill out forms that will get you incorporated – Articles of Incorporation or Articles of Organization
- File with Secretary of State
- Some states you must file initial report
- A Corp must get an EIN
- Corp must create bylaws and resolutions
- LLC must create Operating Agreement
- Issue stock certificates
- Running business, opening bank account, credit cards, etc...
Audio Transcript
Travis:
OK. Now Jake, in general, how does the filing process work? What are
the exact steps in forming and filing an Incorporation or LLC?
Jake:
The first step is always figuring out what you want to do. Next is
making a decision as to what state you're looking to form in. Is it
going to be your home state, or is it going to be, let's say, Delaware,
or another state that you think will give you more protection, or
anything else that you're looking for.
Travis:
Right. Which is a topic that we went over in detail in the Benefits
call, which was excellent information. What comes after that?
Jake:
The next is you've got to fill out the forms that will get you
incorporated. These are either called "Articles of Incorporation" or
"Articles of Organization."
Travis:
OK.
Jake:
For a DBA, it's usually an application for "Fictitious Business Name"
or "Doing Business As" –– something to those lines. So it's finding
what those forms are and then getting the correct information onto
those forms. Once that's done, you file with the Secretary of State.
Once
you've received that back from the Secretary of State, then you'll have
to do a few things. Some states will require you to file what's called
an "Initial Report." There's usually a time frame by which you have to
file that by. As a corporation you have to get an EIN, which is called
an Employer Identification Number.
Travis:
An EIN. Can you tell me what an EIN is? Actually, let's save that for
afterward. I'll shelve that question until you're done.
Jake:
Sure. And then you also have to create what are called "Bylaws and
Resolutions" for corporations, so that you have some set of rules that
your corporation is going to be governed by, and also an "Operating
Agreement" for your LLC. Those need to get drafted and created.
Travis:
OK. Now, what comes after that?
Jake:
After that, it comes to really making sure that the stock certificates
get issued correctly to the individuals that you want to issue stock
to.
Travis:
OK.
Jake:
You issue membership by percentage of units, to people in the LLC. Then
it's running your business: opening up a bank account, getting business
credit cards, really laying all the foundations to create that business
structure.
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