Do you have a business that you've been running as a sole proprietorship and you're ready to take it to the next level? Do you want to turn your business into a company that's recognized by your state of incorporation? If you've said yes to both of these questions, there are some things you're going to need to be aware of before starting the incorporation process.
Here are three things you should do before incorporating your business.
Research Your Business Name
The name of your incorporated business is going to have to be unique as it legally cannot have the same name as an existing incorporated business in your state. This is why it's always a good idea to research the name you want to have for your incorporated business. In order to find out this information, you should be able to use an online search tool in your state.
Once you've ensured that your business name isn't already taken, you should register the name of your business in your state and also trademark the name of your business. Doing these two things will offer further protection, and can prevent the name of your business from being used by others at both the state and national levels.
Come Up With Your Decision Makers
When you incorporate your business, you are going to have to put together your articles of incorporation. This is a legal document that gets filed with the government. The articles of incorporation must include specific types of information including: the registered name of the company and the street address of your business. It will also contain the names of two types of decision makers including:
- Incorporator - the person that prepares, signs, and files your articles of incorporation
- Director - responsible for setting goals for the company and naming the directors
When coming up with your decision makers, they will need to be people that you completely trust, and that are knowledgeable about how a corporation works.
Name Your Business Owners
When you set up a corporation, you are going to need shareholders. These are the people who own shares of stock in your company. While you'll need to list the number of shares of stock your company has, you will not have to list each shareholder.
To help make the transition from a sole proprietorship to a corporation go smoothly, and to ensure you're going by the rules in your state, you may want to hire a corporate lawyer to help you.Share