The Law Offices of John S. Saletta P.C.
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Forming a Corporation
You can incorporate in any of the 50 states. Delaware is the popular state because of its history, experience, popularity and pro-business climate. Over half of the companies listed on the New York Stock Exchange are incorporated in Delaware. Recently, Nevada has also gained popularity due to its pro-business environment and lack of a formal information-sharing agreement with the IRS. Neither Delaware nor Nevada have corporate income taxes, and business filings in these states can usually be performed more quickly than in other states. Many people also choose to incorporate in their home state. This may save you money because the corporation will not need to register as a "foreign corporation" if it does business in its home state, and there is often no need to pay another person to serve as the registered agent. However, if your home state has a high corporate income tax or high corporate fees, and your corporation will not "do business" in that state, it may be wise to incorporate elsewhere. "Doing business" means more than just selling products or making passive investments in that state - it usually requires having an office or otherwise having an active business presence. Saletta.Com allows you to choose among California, Nevada or Delaware corporations.
Officers are appointed by the board of directors to run the day-to-day operations of the corporation. A corporation must have at least three officers: (1) a president, (2) a treasurer or chief financial officer and (3) a secretary. Officers do not have to be stockholders or directors, but they can be. There is no limit on the maximum number of officers, and no limit on the number of offices that a person may hold. In fact, the same person may hold all offices.
Each corporation must have a registered agent, who is the person designated to accept official notice if the corporation is "served" with a lawsuit. A registered agent must be either (1) an adult living in the state of formation with a street address (no P.O. boxes) or (2) a company (such as Saletta.Com) registered with the Secretary of State of the state of formation to be an agent. As previously mentioned, one of the advantages of forming a corporation in your home state is that any officer or director can act as the registered agent. However, there are some advantages to having another person or company act as your registered agent. First, this adds an extra layer of privacy. The names and contact information for the registered agent is publicly available. Second, this ensures that if your corporation is named in a lawsuit, no one will jump out of the bushes and surprise you with court papers. |
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