To establish a corporation in North Carolina, here's everything you need to know.
To form a corporation in North Carolina, you need to take the steps set forth below. To find out what's required to form a corporation in any other state, see Nolo's 50-State Guide to Forming a Corporation.
1. Choose a Corporate Name
Your corporation's name must end with one of the following terms or its abbreviation: "Incorporated," "Corporation," "Company," or "Limited."
Your corporation's name must be distinguishable from the names of other business entities already on file with the North Carolina Secretary of State. Names may be checked for availability at the North Carolina Secretary of State business name database.
You may reserve a name for 120 days by filing an Application to Reserve a Business Entity Name with the North Carolina Secretary of State. The application may be filed online or by mail. The filing fee is $30.
2. File Articles of Incorporation
Your corporation is legally created by filing Articles of Incorporation with the North Carolina Secretary of State. The articles must include the corporate name and address; the name and address of agent for service of process; the number of shares the corporation is authorized to issue; the address of the principal office, if any; the name and address of each incorporator; and the effective date of the articles.
The articles may be filed online or by mail. The filing fee is $125.
3. Appoint a Registered Agent
Every North Carolina corporation must have an agent for service of process in the state. This is an individual or corporation that agrees to accept legal papers on the corporation's behalf if it is sued. A registered agent may be an individual who resides in North Carolina, or a domestic or foreign business entity authorized to do business in North Carolina. The registered agent must have a physical street address in North Carolina. The agent should agree to accept service of process on your corporation's behalf prior to designation.
4. Prepare Corporate Bylaws
Bylaws are an internal corporate document that set out the basic ground rules for operating your corporation. They are not filed with the state. Your corporation is not legally required to have corporate bylaws, but you should adopt them because they (1) establish your corporation's operating rules, and (2) help show banks, creditors, the IRS, and others that your corporation is legitimate. For corporate bylaw forms, see Nolo's website or Incorporate Your Business, by Anthony Mancuso (Nolo). Corporate kits also typically contain sample bylaws.
Keep your bylaws, articles, stock certificates, minutes of shareholder and director meetings, and other important papers in a corporate records book. You can use a three-ring binder or order a corporate records kit through a corporate kit supplier.
5. Appoint Directors and Hold First Board Meeting
The incorporator—the person who signed the articles—appoints the initial corporate directors who serve on the board until the first annual meeting of shareholders (when the board members who will serve for the next term are elected by the shareholders). The incorporator should complete and sign an "Incorporator's Statement" showing the names and addresses of the initial directors. The statement need not be filed with the state--keep it in the corporate records book. For a sample Incorporators Statement, see Incorporate Your Business, by Anthony Mancuso (Nolo).
At the first board meeting, the directors appoint corporate officers, adopt bylaws, select a corporate bank, set the corporation's fiscal year, authorize issuance of shares of stock, and adopt an official stock certificate form and corporate seal. Share issuances by small privately held corporations are usually exempt from federal and state securities laws--see the Nolo Corporations FAQ.
Record the directors' actions in corporate minutes prepared by the incorporator or any of the directors. For corporate meeting minute forms, see Nolo's website or refer to Incorporate Your Business, by Anthony Mancuso (Nolo).
6. File Annual Report
Domestic and Foreign North Carolina corporations must file an Annual Report with the North Carolina Secretary of State. The annual reports are due by the due date for filing your corporation's income and franchise tax returns. You may file the Annual Report online at the Secretary of State's Online Annual Report portal. Alternatively, you may file a paper copy directly with the Department of Revenue, along with your corporation's tax return. The filing fee is $25.
7. Obtain an EIN
Your corporation must obtain a federal employer identification number (EIN). You may obtain an EIN by completing an online application on the IRS website. There is no filing fee.
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