More About Self Incorporation

Self incorporation, or do-it-yourself incorporation, starts in many states with the corporations division of the Secretary of State's office. That is where new business entities are registered and filed. For a list of filing agencies and their online contact information, please click here.

STATE BUSINESS ENTITY LAWS

The National Association of Secretaries of State (NASS), based in Washington, D.C., is a membership organization that is the nation's oldest non-partisan professional organization for public officials. Founded in 1904, the association is an information exchange and it encourages cooperation between state governments.

NASS recently published a report entitled the "State Business Entity Law Summaries" . If you are planning for self incorporation, take the time to look up your state of choice for your small business corporation, limited liability company, limited partnership, or other business entity, and see briefly what are the legal requirements for filing articles of organization. The report also includes information for domestic and foreign companies, and the requirements for a resident agent/statutory agent, registered office, annual state reports, records of shareholders, certificates and statements, service of process, and access to beneficial ownership information by law enforcement. Click here to read the PDF report in your browser, or right-click to download it.

NASS also issued the document, "State Business Entity Law Survey: Executive Summary" which explains how and why the "State Business Entity Law Summaries" report was compiled, who participated in it, and its scope. This summary provides more information on state filing and reporting requirements, the collection of company ownership information for law enforcement purposes, and other NASS company formation task force recommendations. Click here to read the PDF report in your browser, or right-click to download it.

Finally, for several detailed charts of the processes and statistics for company formation and information gathering, state by state (of the 39 states who responded to the survey), check out the "NASS Survey on Company Formation Processes in the States" available here in PDF in your browser, or right-click to download it.

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Please check out our other web pages for more information to help you do your self incorporation the smart way.

DON'T FORGET...CORPORATE FORMALITIES!

Self incorporation or company formation is only the first step in building your small business company, professional practice or investment vehicle fortress. For your company to protect you in the event of a lawsuit, judgment, lien, seizure, bankruptcy, divorce, or God forbid, a revenuer's scrutiny, it's corporate veil must be established and regularly reinforced. This is part of corporate governance and it involves:

• Holding your organizational meeting;
• Adopting resolutions;
• Recording minutes;
• Adopting bylaws or an operating agreement;
• Authorizing and issuing the ownership interest certificates (stock, partnership interest, membership interest, etc.);
• Electing directors, officers or managers;
• Opening company bank accounts;
• Adequately capitalizing your company;
• Keeping separate company books;
• Never co-mingling your funds and business with that of the company's;
• Transacting company business at an "arm's-length" from you, the officers, directors and owners;
• Avoiding "alter ego" and "nominee" status;
• And more.

Make it your practice to start out observing corporate formalities and keeping good records from the conception of your new company. If you've already neglected this important function, then catch up. Get current. And develop good corporate habits. You will be nicely rewarded for your efforts.

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