Starting a new business takes creativity, time, money, sweat, and paperwork. This article will cover a type of paperwork called articles of incorporation. When you are starting a business that you want to classify as a business corporation, you will need to complete this documentation. 

Follow along for the rundown on when you need to file articles of incorporation, what information you’ll need to provide, and a step-by-step process for filing the articles. 

What Are Articles of Incorporation?

Articles of incorporation are legal documents filed to ensure the government recognizes your corporation. Articles of incorporation certify details about your business, such as its name, location, and purpose.

When Do You Need Articles of Incorporation?

The list for creating a small business is, no doubt, a long one. However, properly documenting your business should be at the top of that list. The documents for articles of incorporation should be filed when you are looking to form a business corporation. You must complete these documents if you want to classify your business entity as an S corp, C corp, nonprofit corporation, for-profit corporation, or another type of corporation.

Note that this paperwork process is different from filing for a Limited Liability Company(LLC), as the business structures are not the same.

If you want to separate your business from yourself to eliminate personal risk, you must file incorporation articles. So, when you have your business idea and are putting things into motion, it is time to start the paperwork to incorporate it.

What’s Included in Articles of Incorporation?

• Corporation Name and Address
• Duration of Incorporation
• Nature of Business
• Number of Shares and Type Issued
• Powers of Incorporation Designation
• Registered Agent Name and Address

Corporation Name and Address

Corporation Name

Naming your business might not be as simple as it sounds! Name reservation might take some work depending on what you want to name your business. When filing your incorporation articles, the corporation's name must be unique to your business. You will need to create an original name with thousands of businesses across your state. 

Don’t worry! You are not expected to know the name of every business in your state. Because business names are a part of public records, you can check available business names on the Secretary of State's business page for your location. 

Business Address

You will also need to include the mailing address of your business. This should be the main location where you conduct and operate the business. You can also use a P.O. box, if necessary.

There are other non-operational addresses you will need to include, so keep reading for more information on addresses. 

Duration of Incorporation

This might seem like a strange thing to have to include, but it’s there! If you plan to operate indefinitely, you must choose that option. Some states will ask you to choose this, and others will have this as the default. 

If your business is short-term, like a pop-up or another temporary operation, you will need to denote that in your paperwork. 

Nature of Business

While you might have a very specific purpose for your business, in this case, it is better to keep your business's nature vague in the incorporation articles. The more open-ended this section of your paperwork is, the fewer restrictions you will have on how your business can operate. 

For example, let’s say you are opening a juice bar. A purpose of the corporation that is too specific would read something like, “The nature of this business is to serve juice to my community.” This will box you in, as it states that you will only be serving juice to your community.

Use something more open-ended like, “The nature of this business is to serve my community lawfully.” That way, you have the freedom to supply your community with more than juice if you choose to do so. 

Number of Shares and Type Issued

Number of Shares

By definition, a corporation is an organization owned by shareholders. This means it won’t be just you with a stake in the business. When you are filing articles of incorporation, the government needs to know more about the involvement of those shareholders. 

It is up to you to decide how many shares of stock your corporation will be authorized to utilize. When making this decision, you should weigh what is best for your business and the filing costs. Share authorization and fees will vary by state. Generally, it is not a huge expense, but it is an expense nonetheless.

Type Issued

Once you have decided on the number of shares of stock your corporation will use, you also need to decide on the type of stock: common stock or preferred stock.

• Common stock is a type of ownership in a company 
• Preferred stock is a share of the company that comes without voting rights

Powers of Incorporation Designation

The powers of incorporation refer to who holds what power in the company. This section will depend on the state of operation. Some need detailed information on positions like president, treasury, board of directors, etc. Others will need less information. Again, check your Secretary of State's website for state-specific information. 

Registered Agent Name and Address

This is another section that depends on the state where you operate and the size of your business. Some states will require you to list contact information, like the corporation’s officers' or directors' names and mailing addresses. Others will simply require one name and street address of the incorporator.

Generally, the registered agent is going to be the person designated to deal with the legal side of the business. They do not have to be a lawyer, but they need to be prepared to accept legal documents and information regarding your business. 

How To Write Articles of Incorporation

• Step One: Visit Your Secretary of State’s Website
• Step Two: Fill Out the Necessary Information
• Step Three: Get a Check for the Filing Fee
• Step Four: Submit Your Articles of Incorporation
• Step Five: Begin Operation

Step One: Visit Your Secretary of State’s Website

A quick Google search will direct you there! Simply type in your state’s name and “Secretary of State” in the search bar. This will provide you with the options and information you need to continue. 

Step Two: Fill Out the Necessary Information

Now that you have more context for this part, you just need to gather all the necessary information for your articles of incorporation form. 

Step Three: Get a Check for the Filing Fee

No matter your state, there will be a filing fee. The cost will vary based on state law and the type of company. 

Step Four: Submit Your Articles of Incorporation

Ensure all your information is filled out correctly to prevent delay. Then, it’s time to submit!

Step Five: Begin Operation

Once you’ve been approved to commence operation and received your certificate of incorporation, it’s go time. 

Conclusion

Now that you’ve got the necessary information, it’s time to get to the paperwork. Head over to your state’s Secretary of State website and figure out the state-specific details you need, as well as the filing fee. 

Once you’ve gotten approval, get out there and run your business your way!

Sources:

Common Stock Is The Type Most Shareholders Own And Usually Allows Them To Vote On Major Corporate Actions | Business Insider

Preferred Stocks Supply Steady Dividends To Investors — Here's How To Evaluate Them For Your Portfolio | Business Insider

Articles of Organization Vs. Articles of Incorporation | Small Business Chronicle