The incorporation process requires filing certain documents. This paperwork allows entrepreneurs to form a corporation or an LLC. A business incorporating as a corporation must file articles of incorporation. Companies forming an LLC need to file articles of organization.
What are Articles of Incorporation?
Articles of Incorporation are legal documents filed with a state government to officially create a corporation. They lay the foundation for the business’s legal identity and provide important details about how the corporation will operate. These documents are sometimes called a Certificate of Incorporation or Corporate Charter, depending on the state.
What Information Is Included in Articles of Incorporation?
While the exact requirements can vary by state, most Articles of Incorporation include the following:
Duration of the Corporation: Most corporations are established to exist perpetually, but some may specify a limited duration.
Business Name: The legal name of the corporation, which must be unique within the state of incorporation.
Business Purpose: A brief description of the purpose or activities the corporation will engage in. Some states allow a broad statement, while others require more specific details.
Principal Office Address: The physical address where the corporation’s main office is located.
Registered Agent and Address: The name and address of the registered agent, who is responsible for receiving legal documents on behalf of the corporation.
Incorporator(s): The name(s) and signature(s) of the person or people filing the Articles of Incorporation.
Stock Information: Details about the corporation’s stock, including the number of shares authorized and any stock classifications, if applicable.
Directors and Officers: Some states require the names and addresses of the initial directors or officers, while others do not.
Remember that every state of incorporation is different. Some states may require more information about the corporation in their articles of incorporation.
For example, you may need to specify how the corporation is organized, such as choosing between non-profit, non-stock, or for-profit. Another common question is whether the corporation will have members or if it will be designated as a benefit corporation. It’s important to answer each question accurately. Review the document with any other incorporator(s) before signing.
Where Do I File Articles of Incorporation?
Articles of Incorporation are typically filed with the Secretary of State’s office in the state where you are forming the corporation. In some states, this is handled by a specific division within the Secretary of State’s office.
- Delaware: File with the Delaware Division of Corporations.
- California: File with the California Secretary of State’s Business Programs Division.
- Florida: Submit to the Florida Division of Corporations, also known as Sunbiz.
- Texas: File with the Texas Secretary of State’s Corporations Section.
- New York: Submit to the New York Department of State, Division of Corporations.
The Secretary of State will provide information on their website as to where you need to file your articles of incorporation. As for the filing itself, ost offices have walk-in drop offs, fax, and online filing options.
What Are Articles of Organization?
If an entrepreneur chooses to form an LLC, they will need to file articles of organization.
Articles of organization share some similarities with articles of incorporation. This document contains basic information about businesses that wish to be established as an LLC. It is required in most states of formation to file articles of organization if you choose an LLC as your business entity. Articles of organization must also be filed prior to conducting business as an LLC.
What Should Be In Articles of Organization?
Articles of organization includes basic information about the LLC. This answers the following questions.
- Name of the LLC.
- Street and mailing address of the principal place of business of the LLC. (Some articles of organization ask for this information separately, as some LLCs may have different street and mailing addresses.)
- Effective date of filing.
- Name and street address of the LLC’s registered agent.
- Name(s) and address(es) of the LLC’s member(s).
- Whether the LLC will be vested in members or managers. An LLC may be formed under one of three LLC structures. These include a single member LLC (which is a standard LLC), member managed LLC, and manager managed LLC. Typically, there is a box that can be checked off on articles of organization that alerts the state about the LLC’s structure status.
- Name(s) and address(es) of the LLC’s member(s) if member managed or managers if manager managed.
- Date, print or typed name(s), and signature(s) of person(s) forming the LLC.
Like filing articles of incorporation, articles of organization may have additional questions. Some states may request more information about whether the LLC is an at-will or term company. Others may wish to know the purpose for which the LLC is formed. This will vary depending on the state so be mindful to include the proper answers to these questions. Review the answers with the LLC’s members prior to filing the application.
Where Do I File Articles of Organization?
Are you ready to file articles of organization for the LLC? Prior to filing the completed application, check in with the local Secretary of State. Similar to articles of incorporation, articles of organization are also accompanied by a filing fee. Checks, money orders, and credit cards may pay this fee. Review with the Secretary of State beforehand to make sure you are using an accepted form of payment and making the payment out to the appropriate point of contact.
Additionally, the Secretary of State will outline the way in which you may file articles of organization. Most offices have walk-in drop offs, fax, and online filing options available to entrepreneurs.
Final Thoughts: How Do These Two Documents Differ From One Another?
The primary difference between articles of incorporation vs articles of organization is the business entity they are used for. Articles of incorporation are filed for corporations, while articles of organization are filed for LLCs. Both documents are required for forming these business structures and contain similar types of information, such as names, addresses, and registered agents. However, they serve distinct purposes in the business world.
Frequently Asked Questions About Incorporation Documents
You have learned what it means to file articles of incorporation for a corporation and how to file articles of organization for an LLC. Both filings are similar in requesting information. However, each fulfills different purposes for their respective business entities.
However, there are still a few questions entrepreneurs have about these articles. Below you will find answers to commonly asked questions.
Do All Businesses Need Articles of Incorporation?
No, only businesses that choose to form as a corporation (C Corporation, S Corporation, or Nonprofit Corporation) need to file Articles of Incorporation. Other business structures, like LLCs or sole proprietorships, follow different registration processes.
Does a Sole Proprietor Need articles of Incorporation?
No. Articles of incorporation are necessary to file for businesses that would like to be corporations. Sole proprietors have the least amount of paperwork and filing responsibilities due to the nature of their entity formation. A sole proprietor is an unincorporated entity. Sole proprietorships may draft a business plan for their company, for example, but have fewer filing requirements than incorporated businesses.
Does a Nonprofit Need Articles of Incorporation?
This depends on the nature of the nonprofit entity. If you are filing as a nonprofit corporation, for example, you must complete articles of incorporation for domestic nonprofits.
Filing articles of incorporation for nonprofit corporations is quite similar to that of filing for a corporation. You will need to include the name of the nonprofit corporation, information about the nonprofit’s street address and registered agent, and print names and signatures of authorized officer(s).
The purpose of the corporation, however, will differ to fit the nonprofit’s needs. Often, most of these filing documents require you to check off if you are filing as a public, mutual, or religious nonprofit corporation. It’s also important to note that the filing fees for nonprofit corporations and their articles of incorporation tend to be slightly less expensive than those for corporations. Check in with your local Secretary of State to find out how much you may expect to pay for a filing fee.
Are Articles of Incorporation Confidential?
No. The information in an articles of incorporation application becomes part of the corporation’s public record. As such, the information provided is not considered confidential for corporations.
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