If you are considering incorporating your business or forming an LLC (limited liability company), you either know or are realizing that the process involves certain steps: obtain a registered agent, file the appropriate paperwork, pay the necessary fees, and more.
But what happens after you’ve filed your entity formation documents with the state? What additional steps do you need to take after incorporation?
Each entity type requires different steps
Typically, what you need to do varies by the entity type you’ve chosen to create: C corporation, S corporation, LLC, limited liability partnership (LLP), limited partnership (LP), or nonprofit corporation. Below we’ve outlined key post-incorporation steps specific to these entity types.
Keep in mind that requirements can vary by state. If you plan to operate in more than one state, you will need to complete all necessary registration (foreign qualification), post-registration, and annual requirements in those states.
Common post-incorporation and annual requirements by entity type
C corporation: Post-incorporation requirements
- File initial report and/or publish notice of the incorporation in local newspapers (if required by the state)
- Create initial bylaws
- Issue shares of stock to owners (shareholders) and record in stock transfer ledger
- Hold and document the initial meeting of directors (also called the organizational meeting)
- Hold and document the initial meeting of shareholders
- Obtain a federal tax identification number (EIN)
- File assumed name or DBA certificate (if applicable)
- File beneficial ownership information report, if required
- Open a business bank account, obtain a business credit card, and begin establishing a clear separation of business and personal assets
- Obtain necessary business licenses
C corporation: Annual requirements
- Hold and document annual meeting of directors
- Hold and document annual meeting of shareholders
- File an annual report with the state and pay necessary fees
- Pay state franchise tax
- Pay necessary federal and state taxes
- Renew business licenses
- Renew assumed name or DBA registration (if applicable)
S corporation: Post-incorporation requirements
- File Form 2553 with the IRS to elect S corporation status.
- File state-level S corporation election (if required by the state)
- Publish notice of the incorporation in local newspapers (if required by the state)
- Create initial bylaws
- Issue shares of stock to owners (shareholders) and record in stock transfer ledger
- Hold and document the initial meeting of directors (also called the organizational meeting)
- Hold and document the initial meeting of shareholders
- Obtain a federal tax identification number (EIN)
- File assumed name or DBA certificate (if applicable)
- File beneficial ownership information report, if required
- Open a business bank account, obtain a business credit card, and begin establishing a clear separation of business and personal assets
- Obtain necessary business licenses
S corporation: Annual requirements
- Hold and document annual meeting of directors
- Hold and document annual meeting of shareholders
- File an annual report with the state and pay necessary fees
- Pay state franchise tax
- Pay necessary federal and state taxes
- Renew business licenses
- Renew assumed name or DBA registration (if applicable)
LLC: Post-formation requirements
- File initial report and/or publish notice of the LLC formation in local newspapers (if required by the state)
- Create an operating agreement
- Issue membership interest certificates to owners (members) and record in membership transfer ledger
- Hold and document the initial meeting of members (and the managers, if your LLC is manager-managed)
- Obtain a federal tax identification number (EIN)
- File assumed name or DBA certificate (if applicable)
- File beneficial ownership information report, if required
- Open a business bank account, obtain a business credit card, and begin establishing a clear separation of business and personal assets
- Obtain necessary business licenses
LLC: Annual requirements
- Hold and document the annual meeting of members (and managers, if your LLC is manager-managed)
- File an annual report with the state and pay necessary fees
- Pay state franchise tax
- Pay necessary federal and state taxes
- Renew business licenses
- Renew assumed name or DBA registration (if applicable)
LLP: Post-formation requirements
- Publish notice of the LLP formation (if required by the state)
- Create a partnership agreement
- Issue partnership interest certificates to partners and record in partnership transfer ledger
- Obtain a federal tax identification number (EIN)
- File assumed name or DBA certificate (if applicable)
- File beneficial ownership information report
- Open a business bank account, obtain a business credit card, and begin establishing a clear separation of business and personal assets
- Obtain necessary business licenses
LLP: Annual requirements
- File an annual report with the state and pay necessary fees (if required)
- Pay state franchise tax
- Pay necessary federal and state taxes
- Renew business licenses
- Renew assumed name or DBA registration (if applicable)
Nonprofit: Post-incorporation requirements
- File initial report and/or publish notice of the incorporation in local newspapers (if required by the state)
- File Form 1023 with the IRS to apply for federal tax-exempt status (if applicable for your nonprofit)
- File necessary forms with the state to apply for state tax-exempt status (if applicable for your nonprofit and your state requires it)
- Create initial bylaws
- Issue shares of stock to owners (shareholders) and record in stock transfer ledger
- Hold and document the initial meeting of directors (also called the organizational meeting)
- Hold and document the initial meeting of shareholders
- Obtain a federal tax identification number (EIN)
- File assumed name or DBA certificate (if applicable)
- File beneficial ownership information report, if required
- Open a business bank account, obtain a business credit card, and begin establishing a clear separation of business and personal assets
- Obtain necessary business licenses
Nonprofit: Annual requirements
- Hold and document annual meeting of directors
- Hold and document annual meeting of shareholders
- File IRS Form 990
- File an annual report with the state
- Renew business licenses
- Renew assumed name or DBA registration (if applicable)
Conclusion
Ensuring you undertake all necessary post-formation and ongoing requirements, such as annual reports and franchise tax filings, for your business is important. Doing so helps protect the personal assets of owners (protects the corporate veil) and keeps your company in good standing with its state of incorporation, which means your company has met all state requirements in a correct and timely manner.
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