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7 Steps in Forming Your Own Corporation

By Edited Jun 4, 2014 0 0

A corporation is a common type of business organization. It is usually managed by different people who have the same goal, which is to generate money or to attract clients.

The United States is suffering from an economic crisis today. Many people are being laid off because companies cannot afford to pay them anymore. Instead of working in a company, you can choose to have your own business, provided that you will have enough funds for it.

Forming a corporation may be complicated because of the different legal issues will be involved in the process. You will have an easier time accomplishing your goal if you acquire the legal help of a Los Angeles business lawyer.

With the help of your lawyer, you can easily form your own corporation by following these seven steps:

    • Choose a name for your corporation- The name that you will choose for your business should be in accordance with the rules that are being enforced by California's corporation division. Here are the following guidelines that you should consider while you are trying to think of a name for your corporation:
      • The name should end with "Limited," "Incorporated," or "Corporation." If you want, you are allowed to use their abbreviation (Inc., Corp., and Ltd.).
      • The name should be different and unique.
      • The name should not contain words which are associated with other businesses or the federal government. Here are some examples of words that are prohibited:
        1. Federal
        2. Cooperative
        3. Bank
        4. Reserve
        5. United States
        6. National
        • Choosing the Board of Directors- They are important in a corporation because they are responsible in making financial decisions and policies which will be applied not only to them, but to everyone who will work in the company.
        • Filing all "articles of incorporation"- After choosing what name is appropriate for the corporation and appointing all of the Board of Directors, you will then need to file all "articles of incorporation." These documents are also known as "charter" or "certificate of incorporation."
        • Creating by-laws- These are rules which cover the corporation's daily operations. Your lawyer will make sure that they will not violate state and federal laws.
        • Initial meeting- In this meeting, the corporation's Board of Directors will adopt all of the by-laws and choose corporate officers.
        • Issuing of stock- Issuing of stocks will divide the business's ownership interests.
        • Getting permits and licenses- Getting the required permits and licenses is the last step that needs to be taken in order for the corporation to be complete. Your business will only be considered as legal if you were able to acquire a business license, zoning permit, or seller's permit, among others.


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