Step 3: Decide on share structure
The number of shares of stock that the corporation is authorized to have must be included in the Articles of Incorporation. The corporation must authorize at minimum one share.
Step 4: File Articles of Incorporation with the State of North Carolina
The Articles of Incorporation is the document that is used to officially create a corporation. In North Carolina, Articles of Incorporation are filed with the Department of the Secretary of State for the State of North Carolina and contain the following information:
- Corporate name
- Number of authorized shares and indicate whether shares will be a) all of one class, designated as common stock or b) divided into classes or series within a class.
- Registered agent information (name and address, including county)
- Principal office information (if the corporation has a principal office)
- Name and address of each incorporator (person who prepares and signs the Articles of Incorporation). Only one incorporator is required in order to file.
- Names, addresses, and titles of company officers. (This information may be required for compliance with federal banking regulations. Otherwise, it is optional)
- Business email address (optional)
- Effective filing date. The document is effective as soon as it's filed, unless you specify a different date or time for it to take effect.
Step 5: Hold an organizational meeting
After forming a corporation, you must undertake certain steps to preserve the limited liability a corporation provides its owners.
The purpose of the initial organizational meeting is to complete the organization of the corporation after the Articles of Incorporation are filed. If initial directors are named in the Articles of Incorporation, they will hold the meeting. If initial directors are not named, the incorporator or incorporators shall hold the meeting. A sample of the actions required to complete the organization include
- Appointing directors (if initial directors were not named in the Articles of Incorporation)
- Adopting corporate bylaws
- Electing officers
- Issuing stock
- Selecting a corporate bank
- Setting the organization’s fiscal year
- Setting up a corporate records book
Step 6: Preparing corporate bylaws
Corporate bylaws set out the basic rules for how the business and affairs of the corporation will be conducted. This governing document is not filed with the state, but it is a requirement for corporations in North Carolina.
Bylaws generally cover areas of internal management, including the roles of directors and officers and the holding of shareholders’ and directors’ meetings. The bylaws can include any provisions, as long as they don't conflict with the law or the Articles of Incorporation.
Step 7: Issue shares of stock
Stock refers to the overall ownership in a corporation, while shares represent units or a percentage of that ownership. This is why the owners of a corporation are referred to as shareholders.
A corporation may issue any amount of shares up to the authorized amount set forth in the Articles of Incorporation. To increase the authorized amount requires an amendment to the Articles.
Step 8: Get an EIN
A federal employer identification number, or EIN, is an IRS-issued identification number for businesses. This number is also commonly referred to as a FEIN or federal tax ID number. All corporations are required by federal tax law to obtain an EIN.
An EIN is used for tax filings, as well as for other important business activities, such as opening a business bank account, obtaining a loan, or paying invoices. Check out our article on Federal EIN for more information.
Step 9: Select a tax election (S corporations)
In order for a corporation to become an S corporation, it will need to meet eligibility requirements and file Form 2553 (Election by a Small Business Corporation) with the IRS.
Note that an S corporation is not a separate business structure, but an IRS tax classification. By default, a corporation is taxed by the IRS as a C corporation.
Read What is an S Corp for information on the difference between taxation under Subchapter S of the Internal Revenue Code and Subchapter C, eligibility requirements for filing, and information on maintaining tax status under Subchapter S.
Step 10: Comply with other tax and regulatory requirements for North Carolina businesses
Your North Carolina corporation may be required to complete additional compliance steps in order to legally do business in the state. The following are a few possible requirements:
- Department of Revenue registration. The corporation will need to register with the North Carolina Department of Revenue (NCDOR) and obtain an account ID number. There is a state annual franchise tax that applies to corporations. There may also be additional state tax obligations.
- State licenses. A number of professions and industries require registration with and obtaining licensing from a state agency.
- Employees. Your corporation will have to complete a number of steps if it has employees, including having a federal EIN, reporting new hires (and re-hired employees) to the North Carolina New Hire Directory, and obtaining Workers’ Compensation insurance.
- Local business licenses and permits. Your North Carolina corporation may need to obtain a local business license, as well as fulfill other local license and permit requirements.
- DBA filing. A DBA (doing business as) or fictitious name for a corporation is any name other than the name on its Articles of Incorporation. A North Carolina corporation doing business under a DBA or fictitious name will need to file an assumed business name certificate with its local register of deeds’ office.
- Annual report. North Carolina corporations is required to file an annual report with the Secretary of State’s office.
North Carolina (NC) corporation basics and FAQs
What is the cost to incorporate in North Carolina?
At BizFilings, we clearly outline our fees and the state fees to form a North Carolina corporation. View our pricing to incorporate as a C corporation or S corporation to see:
- BizFilings’ package prices. BizFilings offers three incorporation service packages from which you can choose.
- State fee for standard turn-around. Our pricing clearly shows the state fee to incorporate in North Carolina with standard turn-around.
- Expedited turn-around. You will see the BizFilings and state fee, if any, for expedited turn-around.
- Certified copy. Our pricing also clearly displays the BizFilings and state fee, if any, for issuing a Certified Copy of the Articles of Incorporation.
