Steps to Become a California
Corporation
Typically becoming a California Corporation takes
4-6 weeks, but you can speed up this process to about a week with
expedited service. Expedited California incorporation processing
can be purchased from an online service and will save you a substantial
amount of time. Services will handle every aspect of California
incorporation from filing Articles
of Incorporation to preparation
of all the documents, resolutions and certificates necessary to
incorporate. It is not required by law that you obtain the service
or advice of legal counsel to become a California Corporation.
The first step to incorporate in California is to select a name
for your company. If available, the name can be reserved with the
California Secretary of State for 60 days. Incorporating protects
the name from being used by another California Corporation. However,
the name cannot infringe on a trademark or service mark. Once you
have incorporated in California, you will need to protect the name
from use by non-corporate entities by registering it as a trademark or service mark which is a separate process.
To incorporate, Articles
of Incorporation must be filed with the California
Secretary of State. To complete the process of incorporating, directors
will need to hold a First Meeting of the Board of Directors to elect officers,
in which they will authorize the issuance of stock and adopt corporate
bylaws. Once you have completed these steps the formation of the California
Corporation has been formally established.
If you would like to become a "Subchapter
Corporation S", you must file
IRS form 2553. This form should be filed within 75 days of the filing
of the Articles
of Incorporation. All the shareholders
of the Corporation must sign the form for the S
corporation status to be accepted by the
IRS. California incorporation services have an automated
way to file this form along with your articles.
You will also need to obtain A Federal
Tax Identification Number for
the company (also called an "EIN" or "Employer ID Number") and a California
Employment Development Department (EDD) employer account number. Both
of these can be obtained from the IRS for taxation purposes and for opening
a corporate bank account following California incorporation. The number
is obtained by filing IRS form SS-4.
If you plan to operate your California Corporation under a fictitious
name, a Fictitious
Business Name statement must be filed with the County
Clerk in the county of the company's principal place of business. It
must be filed within 40 days start of business. Also, within 30 days the
registrant must publish the statement in a newspaper of substantial circulation
in the same county once a week for four weeks. Once completed, an affidavit
of publication will need to be filed with the County Clerk's office as
proof.
The California agency responsible for administration and enforcement
of California corporate, business and personal income taxes is the Franchise
Tax Board. If the corporation will be selling products in California,
it must obtain a seller's permit from the State Board of Equalization
and pay California sales tax for the products it sells.
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