Understanding the Steps to Form a Corporation
April 27, 2022
If you’re starting a business in South Carolina and you have chosen to operate as a corporation, you’ll need to follow a few straightforward steps to form this business structure. Doing so helps ensure that you’re following the appropriate legal guidelines when conducting your business.
Choosing a Business Name and Identifying Your Location
The first step to take when forming a corporation is to choose a name for your company. You’ll also need to identify the location of your headquarters, which can be different than where you conduct the majority of your business. However, sticking with your home state may be the easiest.
Selecting the Type of Corporation and Naming Company Directors
When forming a corporation, you have three choices. You can operate as a C Corporation, S Corporation or LLC. Examining the pros and cons of each option can help you choose the appropriate one for your company. Next, you need to select your company’s directors. This action is vital as they’ll likely be consulted to make essential decisions regarding your operations and the trajectory of your company.
Determining the Type of Shares and Obtaining a Certificate of Incorporation
If you’ve decided to form a private corporation, you’ll need to determine the type of shares it has available. When completing this task for your small business, the number of available shares will likely be limited and given to only a few individuals. After completing this step, it’s important to obtain a certificate of incorporation and fill it out.
Processing and Filing the Paperwork
Submitting the articles of incorporation for your company and paying the required registration fee finalizes the process. Knowing these steps and carrying them out will help ensure that your corporation gets started correctly according to all legal parameters and guidelines.