- A corporation is a separate legal entity from its shareholders and offers limited liability protection.
- There are three main types of corporations in Georgia: for-profit, non-profit, and professional.
- Registering a corporation requires filing Articles of Incorporation with the Georgia Secretary of State.
- A unique and distinct name is required for the corporation to be registered.
- A registered agent with a physical address in Georgia is necessary for the registration process.
- The number of authorized shares must be declared during registration for for-profit corporations.
- There are various methods for registering a corporation: online, by post, or in person.
- The corporation must obtain an Employee Identification Number (EIN) from the IRS.
- Georgia corporations are required to file an annual registration, which can be submitted for up to three years at once.
- Ensuring compliance with permits, licenses, and insurance, such as Worker's Compensation insurance, is crucial for running a corporation in Georgia.
The first step for forming a corporation in Georgia is to know where to begin. After deciding on a business plan and arranging funding, the next step is to register. Your business is unique, and the name you want to register should reflect it. Finally, a corporation should be registered with the Secretary of State with an Articles of Incorporation. From the filing fee to the registered address, knowing how to complete each requirement is crucial. The secretary of state has all the necessary information for the filing procedure.
What Is A Corporation?
A corporation is a business entity. Three types of people are involved in a corporation's smooth functioning. The shareholders hold the equity, the directors help with the decision-making, and the officers. Legally speaking, a corporation is treated as separate from its members or shareholders. It means that a suit filed against a corporation cannot be brought against its shareholders or directors personally. While a judge may opt for lifting the corporate veil in certain circumstances, a corporation primarily offers limited liability. A business, like a corporation, can be for-profit or non-profit. A for-profit corporation will have to pay taxes on its yearly surplus.
Similarly, the shareholders also pay tax on their income from dividends. There are also ways to save on tax if you want to run a corporation in Georgia. You can register as an S Corporation. All the income and surplus of an S Corporation is passed through its shareholders, which allows a business to save on tax. It is called an S Corporation because the business has agreed to be taxed as per the subchapter S. The owners and shareholders can be different, but the key feature of a corporation is its being a distinct legal entity.
How To Form A Corporation?
To form a corporation in Georgia, it is best to register the business with the Secretary of State. Following the legal mandates will help your business take off on time.
Start The Preparation
It is best to collect all the necessary information about filing the documents before registering a formal application. Firstly, you need to decipher if your business is classified as domestic or foreign. Any business opening for the first time in Georgia is a domestic business. On the other hand, a corporation already existing outside the state borders will be treated as a foreign entity.
For instance, a corporation based in Alabama and a corporation based in Canada will both be treated as foreign corporations. Before you begin the filing, ensure the availability of a registered agent. A registered agent is a company or person who has a physical address in Georgia. The crucial role of a registered agent is to send and receive correspondence through their registered address. It is also essential to decide on some optional provisions. Optional provisions include information that you volunteer despite it not being mandated by law.
Additionally, a corporation also needs to decide on the shares they will issue before registration. The number of authorized shares is a mandatory declaration from any new corporation. In contrast, there is no such provision for non-profit corporations. However, a non-profit corporation should declare how many members they will have.
After gathering the preliminary information, you should think about the name of the business. It should be unique and distinct from the name of any other corporation. When you register your name, each application gets a registration number. It is crucial to keep it at hand for business filing.
The most critical information required at the time of filing is the contact details. For instance, the application requires the contact information and complete contact information of the registered agent and the incorporation. In addition, the application can also include the previously mentioned optional provisions. The address of the principal place of business is also necessary because that will serve as the primary location for the corporation.
The Articles of Incorporation are also necessary to do business in Georgia. It includes the essential details that serve as a foundation for your corporation. The required information is the contact information of key members and the registered agent, and the organization's official address. The Articles should also mention a for-profit corporation's authorized number of shares. The structure of the organization is also mentioned in the Articles as it is a formative document for processing, tax-saving, and fund-raising.
You should also set up a mode of payment for the filing fee. It is advisable to have a separate mode of payment for all the business expenses. You can accomplish it by opening a bank account in the name of your business or creating an accounting book that records every credit and debit.
Register Your Corporation
The Secretary of State of Georgia allows flexible methods for registration. You can easily submit your application online, offline, or via physical mail. The procedure of all three of them varies.
For online registration, you will have to create an account on the Secretary of State website. After creating an account, you can begin the registration process by selecting the type of corporation you want to run. The available options are for-profit, non-profit, and professional. The form requiring the requisite information can be filled out online, and you will need to pay a fee. The online procedure has a filing fee of 100 USD.
The mode of payment can only be through the approved cards. The processing time can be expedited if you are in a time crunch. For example, to complete the registration in two days, you must pay 100 USD more. The regular time for processing a registration application is a week (business days). It is also possible to complete the registration on the same day with an additional fee of 250 USD.
If you want to submit your application via post, the first step is to create an Articles of Incorporation. The Articles need to be filed as per the legal requirement of the state and in the right size of paper. The secretary of state has a detailed explanation of what the Articles should include. The next step is to fill out the registration form for a corporation. The filing fee for the registration form and processing is 110 USD. It is acceptable to provide either a money order or a cheque.
You should send the complete documentation, form, and payment to the correspondence address of the Secret of State in Atlanta, Georgia. The expedition fee is the same as that of an online filing. However, the processing time for a mailed application is approximately 15 days. However, there is an option of expediting the process within the hour. It will cost an extra 1000 USD.
The last alternative is to file the registration in person. Here, the business first requires an Articles of Incorporation. The secretary of state has a complete set of instructions and a draft on how to create an Articles of Incorporation. The remaining procedure of filling out the form and submitting it remains the same. The main difference is that you will have to physically go to the address of the Secretary of State to submit the documents.
The time for filing the documents is from Monday to Friday. State holidays are an exception, so stay updated on Georgia's calendar. The office timings are between 8:00 am to 5:00 pm. The response time of physical filing varies on the submitted applications. However, the process can be expedited. The expedition fee is the same as above.
After submitting your application, you must wait for the estimated processing time. The registered name will be checked against the records, and if it is distinct, the application will be processed in the stipulated time. After processing, you will receive your Certificate of Incorporation via mail. Every incorporated business is then legally mandated to submit an annual registration of their business.
The annual registration requires the registration of three officers from the organization. It is compulsory for types of corporations. The filing fee varies as it is 20 USD cheaper for non-profit corporations as compared to 50 USD for professional and for-profit corporations. The time limit for filing this annual mandate is within 90 days of being incorporated. The only exception to this mandate is the corporation's incorporation from October to December. They should file their annual registration between the months of January to March, with the last date being the first of April.
Annual registration is not only for newly incorporated businesses. It is also for already registered businesses in Georgia. A business must register its business yearly to ensure its right to do business in the state is valid. However, rather than filing it yearly, a corporation can submit the registration for three upcoming years at once. The registration time is between January to March. The following points of consideration are the tax filings that need to be regular irrespective of whether you are an S Corporation.
The IRS also requires every business to have an EIN (Employee Identification Number). It is like a social security number for business entities. The IRS can keep track of corporations that hire employees and pay taxes in their own name. An EIN is also mandatory for being able to hire employees. Additional registrations with the Department of Revenue and the Department of Labor are also necessary. After getting incorporated, you should also consider getting insured and obtaining appropriate licenses that apply to your business activity.
The right way to form a corporation in Georgia is to read through all the guidelines of the Secretary of State. It would help if you chose a different name to do business as a domestic or foreign entity in the state. The filing of applications for incorporation is available through both online and offline modes. A corporation needs to register for taxes, business permits, and federal EIN. To run a profitable business, you need to stay updated on all legal requirements in Georgia, like Worker's Compensation insurance and annual registration. From the Articles of Incorporation to the daily activities of the business, it is best to follow legal mandates.
Frequently Asked Questions (FAQs)
How To Select The Right Name For The Corporation?
The proper name for the corporation should correspond with the business. It should also be unique in Georgia. Additionally, you can search for your name to see if the domain name is available. Registering a name with the Secretary of State gives you 30 days to file for Incorporation. If the name is unique, you can get the application processed within 1-2 weeks.
What Are The Necessary Permits And Licenses For A Corporation?
Necessary permits and licenses are for specialized services. For instance, alcohol permits are necessary for restaurants. Restaurants and bars may also need additional specialized permits. In addition, registration to practice cosmetology in Georgia is necessary for hair stylists.
Is Insurance Mandatory For A Business?
Insurance is not mandatory for a business, but it is highly prescribed. Business Insurance includes insuring the property, workers' rights, and life insurance. Workers' Compensation insurance is mandatory in Georgia. If you need a specialized license, the authorities may also ask for other insurance.
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