Congrats: You left your staff job to strike out on your own.Now what?One of the first decisions every solopreneur must make is what type of business they want to create. Why does it matter? The type of company determines how much you pay in taxes, your ability to raise money, the paperwork you need to file, and your personal liability. (Check out the U.S. Small Business Administration's Guide to Choosing a Business Structure and consult an accountant and or an attorney if you have questions about the process.)If you decide that a corporation is the best for your needs, follow these steps:Step 1: Name Your CompanyBrainstorm a few options that are descriptive and memorable. Then, you check with your state's corporate filing office as well as federal and state trademark registrars to see if it's available.Step 2: Figure Out Your HQ Location
Select a state as your headquarters' location. (This doesn't necessarily need to be where you live or even where you expect to do the majority of your business.) Different states vary in cost to incorporate, taxation, and corporate laws. Consult with a lawyer or an accountant to weigh your options.
Step 3: Pick a Type of CorporationYou can incorporate your business as a C Corporation, an S Corporation, or a Limited Liability Company (LLC).
Step 4: Select Your Company DirectorsA corporation is required to have a board of directors who are effectively responsible for running the corporation.Step 5: Determine the Type of Shares
Select the type of shares your corporation will sell to stockholders. In many cases, corporations are private, limiting the availability of the shares to only a few people, like your directors.
Step 6: Get a Certificate of Incorporation
Complete a Certificate of Incorporation, available from your state's corporate filing office. It will include your company name, the purpose of the business, location, and other information gathered in the previous steps.
Step 7: File Paperwork
Submitting the articles of incorporation to the state, along with the registration fee. You can file the paperwork yourself, through your attorney, or use a third-party service.
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