How to Incorporate

Receive some tax breaks by incorporating your business.

Incorporating a business is the first step toward protecting you from personal liability if an incident should occur. When an incorporated business owner faces the unexpected, like product loss or a lawsuit, he or she has a greater level of financial security. Besides personal protection from business debt, the "Inc." extension grants credibility and even some tax breaks. With incorporation, the business can be sold or even inherited by family. Under sole proprietorship, the business is closed if the owner leaves for any reason.

Instructions

1. Retrieve the appropriate incorporation form from the website of your Secretary of State's office. Request paper applications or use the electronic form if one is available. Choose the nonprofit of for-profit form. Nonprofit incorporation forms are for businesses that run as charities like churches or missions.

2. Fill out the sections or articles of the form. Each article will request specific information like the name, how long the business has existed and the purpose of the business. Other required information may be the address and owners. For nonprofits, you will be asked to name your board and directors.

3. Print and sign the forms, then return them to the Secretary of State. Some forms may allow you to sign electronically.

4. Pay the incorporation fees using your credit or debit card. These fees may range from $100 or more per incorporation.

Tips & Warnings

• States may require notarization.

• Legal attorneys and legal websites offer incorporation services for a fee.

• Amendments to your Articles of Incorporation must be made through the state and may incur more fees.

References

• Incorperate.com: Benefits of Incorporating
• University of Arkansas: Legal eSource FAQs
• Alabama Secretary of State: Incorporation for Non Profits Form

Resources

• Read this Article in Spanish