Articles of Incorporation
What it is:
It is important to note the difference in the business laws of each state before considering opening a business in a certain domicile. Most business owners consult attorneys before filing their articles of incorporation.
How it works (Example):
The articles of incorporation must be filed with the Secretary of State for the state in which the corporation is headquartered. Many state government websites offer basic templates for articles of incorporation. Although requirements vary by state, articles of incorporation typically include the following:
- The corporation's name and address
- The corporation's purpose
- Whether the corporation is nonprofit or for-profit entity
- The name and address of the corporation's registered agent
- The number of shares authorized
- The classes and par values of these authorized shares
- The directors of the new corporation
Once they are filed and approved by the Secretary, the corporation is considered to be legally created. In most cases, there is fee to do this.