Filing to incorporate a business as a legal entity is a fairly straightforward process. You choose a state of incorporation, fill out an application specific to your entity formation, and pay a filing fee. Once you have formed an LLC or corporation, what’s next on your newly incorporated business? What comes next after incorporation?
The answer is that there are certain legal steps still necessary to launch your startup. Chances are you may be in the middle of completing a few after incorporation. Here’s what you need to focus on to stay in compliance.
- Draft Corporate Bylaws or LLC Operating Agreement
- File an Initial Report and Annual Report
- Obtain a Federal Tax ID
- Open a Business Bank Account
- Register a Trademark
- Apply for Business Licenses
- Consult a Legal Professional
Draft Corporate Bylaws or LLC Operating Agreement
Some of the next steps after incorporation will be determined by the entity you decide to incorporate as. For example, some entities may be in states that require the business to publish notice of incorporation in its local newspaper.
Two of the most popular entity formations, corporations and limited liability companies (LLCs), require their owners to draft corporate bylaws and an LLC operating agreement.
Corporate bylaws are documents that specify the internal management structure of a corporation. Bylaws are drafted by the corporation’s founder or board of directors. Corporate bylaws focus on rules for electing directors to the board, how to organize and conduct meetings, rights and responsibilities of owners, and instructions for adding or removing directors.
Similarly, an LLC operating agreement defines how an LLC will be run by its owner(s) or member(s) of the LLC. An LLC operating agreement covers details on the rights and responsibilities of members, the distribution of profits, losses, and assets, instructions for members that join or leave the LLC, and what dissolution may look like for the LLC.
Did you incorporate as a different entity? You may decide to draft a different type of agreement. For example, a partnership would draft a written partnership agreement for its partners. Drafting a written agreement essentially acts as a blueprint to properly run the business. Owners may review this document to ensure the business is running smoothly and keep extra copies for referral purposes.
File an Initial Report and Annual Report
An initial report is filed once an entrepreneur has incorporated or formed an LLC for their business. This document covers basic business information and allows the state to better understand what the business does and its activities.
However, not all states require businesses to file initial reports. Review our list of states that require businesses to file initial reports. Remember that an initial report must be filed within 90 days of filing to incorporate as an LLC, corporation, professional corporation (PC), and nonprofit.
An annual report is filed on an annual basis with the Secretary of State. This report is quite simple. It records any changes made in the business over the last year. For example, you may note change in business address or registered agent in an annual report. Follow MyCorporation’s chart for upcoming annual report filing deadlines in each state so you never miss a due date. Our chart also notes deadlines for upcoming biennial reports and franchise tax reports.
Obtain a Federal Tax ID
Most federal tax IDs are known as employer identification numbers (EINs). This is a nine-digit number the IRS issues to small businesses that incorporate or form an LLC. It helps identify and track employer tax accounts. This ensures your business is collecting payroll taxes.
Obtaining an EIN is important for several reasons. You may use this tax ID to legally identify your business. This means that you do not need to use your social security number on legal paperwork. Use an EIN and protect your personal identity.
EINs also allow businesses to open business bank accounts, hire employees, and establish business credit profiles.
Register a Trademark
Does your business have a unique name, slogan, logo, design, or tagline? Protect this piece of intellectual property by registering for a trademark at the federal level.
Conduct a trademark search first. This ensures the mark is original and is not infringing on any existing or pending applications. If the mark is available, file a trademark application. This gives you, the owner, exclusive rights to the mark.
Open a Business Bank Account
Your business will need its own separate business bank account. This ensures the revenue earned by the business and any business transactions does not co-mingle with your personal finances. You may use an EIN to open a business bank account, along with your company’s certificate of formation.
Planning to file for a doing business as name (DBA)? A DBA allows you to conduct business under a name that is different from your legal name. You may also use a DBA to open a business bank account and collect checks and payments through the company DBA.
Apply for Business Licenses
Your business may need certain business licenses depending on the city, county, and state where you do business and your business activities.
Check in with your local Secretary of State. Find out which licenses and/or permits your company needs and file for these documents accordingly. If you need additional help, MyCorporation may assist you with our business license compliance package.
Consult a Legal Professional
What’s next for your business? Do you need any additional coverage? What kinds of documents do you need to file to stay in compliance? Do you know what it means to be in good standing?
In conclusion, meet with a trusted legal or accounting professional. They can help answer questions about your newly incorporated startup. In addition, they provide additional guidance moving forward with your new business.
We are ready to assist post-incorporation! Visit us at mycorporation.com or call us at 877-692-6772.