What is a corporation?
A corporation is a business entity that exists as its own legal person, separate from the people who own or manage it. It’s owned by shareholders and governed by a board of directors who make major decisions and oversee operations. While corporations can have multiple shareholders and directors, you don’t need a large group to get started—you can be the sole shareholder and director of your corp if you’re operating independently.
One of the biggest perks of a corporation is its strong liability protection—your personal assets are kept entirely separate from the business’s obligations. Corporations also offer distinct advantages over other structures, like LLCs. For example, they have an easier time raising capital since they can issue stock to investors. Ownership is also more flexible, with shares that can be transferred or sold. Plus, corporations have a perpetual existence, meaning they continue to operate even if ownership changes.
If you’re looking to build a scalable business, attract investors, or create a formal structure with long-term stability, forming a corporation is an excellent choice. While LLCs are a simpler option for many small businesses, corporations shine when your goals include growth, funding, and credibility.
How to form a corporation
Our guide unravels each step of starting a corporation, spelling out the best strategies along the way. From naming your business to filing the right documents, each step plays an important role in creating a legally recognized, structured entity that’s ready to operate.
These steps will guide you through the process of forming your corporation and preparing it for a strong start.
STEP 1
Choose a name for your corporation
Landing on a name for your business should be one of the first things you do. Just like with LLCs, your corporation’s name should be easy to remember, grow with your brand, and meet state requirements. Most importantly, the name should be unique and not already in use by another business in your state. You can verify availability by searching your state’s Secretary of State website.
Already have a business name? No problem—you can adapt it to meet state requirements by adding a corporate designator like “Inc.,” “Corp.,” “Incorporated,” or “Corporation.” These identifiers make it clear that your business is a corporation and are typically required by law. Be sure to check your state’s specific guidelines for acceptable naming conventions.
It’s also a good idea to ensure that your business name’s matching domain is available. Use our domain name search to secure your domain—or check our WHOIS lookup tool for up-to-date info on registered domains you’ve got your eye on.
Finally, registering a trademark on your corporation’s name helps protect it as intellectual property. A trademark gives you exclusive rights to your name, safeguarding it against unauthorized use by others in your industry.
STEP 2
Choose a registered agent
Most states require corporations to have a registered agent on file. This individual or entity is responsible for receiving legal and official communications, such as lawsuits and tax notices, during regular business hours.
When you form your corporation with Epik, registered agent service is included in your package! This means we’ll handle these crucial communications for you, ensuring you stay compliant with state requirements from day one.
Working with a professional registered agent service like Epik also offers an added layer of privacy. Instead of listing your personal address on public filings, we’ll use our business address, protecting your personal information from being easily accessible in public records. This keeps you safe from unwanted solicitations, spam, and potential security risks.
While you can technically act as your own registered agent, partnering with Epik ensures reliable compliance, consistent availability, and peace of mind—so you can focus on building your business.
STEP 3
File your Articles of Incorporation
Your corporation officially begins when you file the Articles of Incorporation (or Certificate of Incorporation) with your state’s Secretary of State. These documents establish your corporation as a legal entity and typically include your business name, your corporation’s purpose, registered agent details, authorized shares, and the names of the incorporators.
Filing fees vary by state, usually ranging from $50 to $500. While you can file these documents yourself, hiring a professional service ensures accuracy and saves time.
STEP 4
Get an EIN
An EIN (Employer Identification Number) is your corporation’s unique tax ID, assigned by the IRS. This number is essential for filing taxes, opening a bank account, hiring employees, and applying for permits. Applying for an EIN is quick and free on the IRS website, and it’s a crucial step in establishing your business’s legitimacy.
STEP 5
File a BOI report
Corporations formed on or after January 1, 2024, must file a Beneficial Ownership Information (BOI) Report with FinCEN within 30 days of incorporation. This report provides details about individuals with at least 25% ownership or significant control in your corporation, including their birth dates, addresses, and government-issued ID numbers. While this information isn’t made public, it ensures compliance with federal transparency laws.
When you hire Epik to form your corporation, we take care of your BOI report for you. For just $25, we’ll prepare and submit the report, ensuring your corporation meets this federal requirement without any hassle.
STEP 6
Write your bylaws
Corporate bylaws are your corporation’s internal rule book, outlining how it operates and makes decisions. This document governs processes like voting, issuing stock, appointing officers, and holding meetings. While most states don’t require you to file bylaws, having them is essential to avoid misunderstandings, ensure smooth operations, and present a professional image to investors and stakeholders. Think of them as the foundation for your corporation’s success.
STEP 7
Schedule an organizational meeting
Your first official corporate meeting, called the “organizational meeting,” sets your corporation’s structure in motion. During this meeting, you’ll make key decisions like appointing officers, issuing stock, and finalizing important details such as insurance and loans. Record all actions and discussions in meeting minutes, which become part of your permanent corporate records.
STEP 8
Open a business bank account
A separate business bank account is vital for protecting your corporation’s limited liability status. It keeps your personal and business finances separate, ensuring the corporate veil stays intact. To open an account, you’ll need your Articles of Incorporation, bylaws, EIN, and possibly a corporate resolution. A dedicated account also simplifies financial management, tax reporting, and daily operations.
STEP 9
File initial and renewal reports
Many states require corporations to file an initial report shortly after incorporation and renewal reports annually or biennially. These reports update your corporation’s information in state records and ensure compliance. Failing to file on time can result in fines, penalties, or even administrative dissolution, so staying on top of these filings is critical to keeping your corporation in good standing.
STEP 10
Be ready to expand
If you plan to do business in other states, you’ll need to register your corporation as a foreign entity in each state. This process, called “foreign qualification,” is required for legally operating outside your state of incorporation. Check out our detailed guide on foreign qualification for more info.
Benefits of corporations
Incorporating your business offers more than just a formal structure—it provides key advantages that can help protect your assets, build trust, and drive growth. Here’s how forming a corporation can set your business up for success:
Perpetual existence
Corporations are designed to last indefinitely, continuing operations even if ownership changes. This stability ensures your business can thrive long-term and adapt to future needs.
Strong liability protection
One of the biggest advantages of a corporation is the separation of personal and business assets. Incorporating protects your personal finances from business debts or lawsuits. This added security reduces personal risk and boosts peace of mind.
Credibility and professionalism
A corporation’s formal structure adds legitimacy to your business, making it easier to gain trust from clients, investors, and partners. Incorporating demonstrates your commitment to running a serious, well-organized venture.
Growth and funding potential
Corporations can raise capital by issuing stock, making it easier to attract investors and fund new opportunities. This flexibility is ideal for businesses looking to scale, innovate, or expand into new markets.
Why you should hire us
Business guidance
Forming a corporation can seem complex, but you don’t have to navigate the process alone. We’re here to help you protect your assets, set up your corporation the right way, and avoid common legal missteps so you can stay focused on growing your business.
Local expertise
Our team works with businesses in all 50 states and understands the nuances of state-specific requirements for corporations. From knowing which forms to file to ensuring compliance with each state’s rules, we’ve got the expertise to guide you through the process and keep you compliant year after year.
Privacy
When you hire Epik to form your corporation, you gain the added benefit of keeping your personal address off public records. By using our business address on government filings, we help safeguard your privacy and keep your data secure.
Peace of mind
We know tracking filing deadlines and staying up-to-date on changing regulations isn’t the most exciting part of running a corporation. That’s why we handle it for you—so you can focus on leading and growing your business, worry-free.
How our services work
When you choose Epik, we make forming your corporation simple and stress-free—and we include one year of registered agent service to keep you compliant from day one. Here’s how the process works:
1
Click “Form Your Corporation” below. This will take you to an online form where you can create your business and your Epik account all in one place.
2
Tell us about your corporation. We’ll ask you a few questions about your business, such as its name, contact details, and the state where it will operate. You’ll also have the option to add additional services, like a free domain for one year and free trials of web hosting, business phone service, professional email, and more.
3
We handle the paperwork. We’ll gather all the necessary state information, prepare your Articles of Incorporation, and submit them to the appropriate state agency for approval. You can trust us to handle the details and get everything done accurately.
4
Get your business online. While your incorporation is being processed, we’ll help you establish your online presence. From securing your domain to launching your website, we make sure you’re ready to connect with customers right away.
5
Stay compliant with ease. Once your corporation is approved, we’ll notify you and keep you informed of any filing deadlines or compliance requirements, such as annual reports and fees—and we’ll even file your annual report for you! With Epik, staying compliant is no hassle.
Build your business with confidence
Incorporating your business is simple with Epik—and includes a free domain for one year plus 90 days of free web hosting, to get you online fast.
FAQ
What is a corporation?
＋A corporation is a legal entity that is separate from its owners, known as shareholders. It is formed under specific laws and regulations, allowing it to conduct business, own assets, and incur liabilities in its own name.
What’s the difference between an LLC and a corporation?
＋An LLC (limited liability company) and a corporation are both legal business structures offering limited liability protection. However, they differ in terms of management, taxation, and ownership. LLCs offer more flexibility in management and taxation, allowing for pass-through taxation, while corporations have a more rigid structure with shareholders, a board of directors, and double taxation.
What’s the purpose of incorporation?
＋The primary purpose of incorporation is to provide limited liability protection to its owners, shielding them from personal liability for the corporation’s debts and obligations. Additionally, incorporation offers advantages such as perpetual existence, ease of raising capital, and potential tax benefits.
What are the different kinds of corporations?
＋There are several types of corporations, including:
- C Corporation: The most common type, with shareholders, directors, and officers, offering limited liability to its owners.
- S Corporation (S Corp): A tax election (not a type of corporation) that passes corporate income, losses, deductions, and credits through to its shareholders for federal tax purposes. Other business entities can choose to be an S corp, including LLCs.
- Nonprofit Corporation: Formed for charitable, educational, religious, or scientific purposes, typically exempt from certain taxes.
- Professional Corporation (PC): Formed by licensed professionals (e.g., doctors, lawyers) to provide services within their licensed profession.
How much does it cost to incorporate?
＋The cost of incorporating varies depending on factors such as the state of incorporation, legal fees, and any additional services required. Generally, state filing fees range from $50 to $800. At Epik, our incorporation service is $225 plus state fees—and that includes formation service and one year of registered agent service. After one year, registered agent service renews at $125 per year.
How do corporations pay taxes?
＋Corporations are subject to corporate income tax on their profits at the federal, state, and sometimes local levels. They file their taxes using Form 1120 with the IRS. Additionally, shareholders pay taxes on dividends received from the corporation, resulting in double taxation. However, corporations that have elected S corp tax status benefit from pass-through taxation, where profits are taxed only at the shareholder level.
What should I consider before incorporating?
＋Before incorporating, it’s crucial to consider factors such as the nature of your business, anticipated growth, taxation implications, legal requirements, and ongoing compliance obligations. Consulting with legal and financial professionals can help ensure that incorporation aligns with your business goals.
What are the pros and cons of a corporation?
＋Pros:
- Limited liability protection for shareholders.
- Perpetual existence independent of its owners.
- Ability to raise capital through the sale of stock.
- Potential tax advantages and flexibility in structuring ownership.
Cons:
- Complex legal and regulatory requirements.
- Double taxation of corporate profits (C corporations).
- Costs associated with formation and ongoing compliance.
- Potential for conflicts between shareholders, directors, and officers.
How can I conduct business with my corporation in more than one state?
＋To conduct business in multiple states, your corporation needs to register as a foreign corporation in each additional state where it operates. This involves filing paperwork and paying fees to each state’s Secretary of State or similar authority.
