The document outlines an 11-step process for forming a business entity that includes choosing an entity type, reserving a company name, filing articles of incorporation, designating a registered agent and office, issuing shares, electing directors and officers, adopting bylaws, opening a business bank account, considering an S Corp election, addressing other considerations like licenses and permits, and annual requirements. It also lists optional additional documents to consider.

1. Copyright 2016 © Margaret A. Moon, esq.
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Business Formation Check List
STEP 1: Choice ofEntity
1. Corporation
2. S Corporation
3. Limited Liability Company
4. Limited Liability Partnership
5. 501(c)3 Non-Profit
STEP 2: Choose a Company Name
 Check with Secretary of State before filing Articles of Incorporation to make sure the name is available
 Check your state’s company name requirements - many states require that the word “corporation”,
“incorporated”, “limited, or “company” (or an abbreviation) is included in the company’s name
STEP 3: File Articles of Incorporation
 Prepare and file Articles of Incorporation and pay the Filing Fee
 Make sure to include: a) Company name exactly how you want it to appear, b) Company’s address, c)
name and address of the Incorporator, d) Registered Agent and Office, e) total number of shares the
Company is authorized to issue, if required, and f) a statement of purpose
STEP 4: Have a RegisteredAgent and Office
 Must have both. The Company itself cannot act as its own Registered Agent. However, the Registered
Office address can be the same as the Company’s address and any shareholder, director or officer can act as
the Registered Agent. BUT if the Company (or any individual on behalf of the Company) is not located
within the State of Incorporation, you must use a paid service to act as the Company’s Registered Agent and
Office. Contact the Secretary of State for a list of reputable services.
 Designate these in the Articles of Incorporation; they may be amended at any point if needed
STEP 5: Shares
 Designate the total number of shares the Company has the power to issue (generally no less than 1,000)
 Designate any desired classes or series of shares (by default all shares are common voting stock)
*Consider placing restrictions on voting rights or having preferential treatment for payment of dividends
for some shares
* Will any shares be subject to a vesting schedule? If so, consider Section 83(b) tax election
 Consider setting par value of shares (generally no more than $0.01)
* Check your state’s requirements for shares. In some states you can only have one class or series of
shares and you may be subject to higher taxes depending on the number of shares your company is
authorized to issue or what your par value is
STEP 6: Last Action by the Incorporator

2. Copyright 2016 © Margaret A. Moon, esq.
All rights reserved.
 Must elect first Board of Directors by written resolution (must have at least one director, who may also
be the incorporator and sole shareholder)
STEP 7: First OrganizationalMeeting of Boardof Directors
 May pass written Organizational Resolutions in lieu of a first meeting
 Elect Officers - must have at least a CEO and CFO
 Recognize filing of Articles of Incorporation
 Set the Fiscal Year
 Issue Shares to initial Shareholders
 Authorize any other required transactions or
actions
STEP 8: Adopt Bylaws or Operating Agreement
 Not required by most states (unless you’re incorporating a 501(c)3 non-profit), but highly recommended.
Many states require Operating Agreements for LLCs
 Must be adopted by the Board of Directors at a meeting or by a written resolution, can be done as part of
the Board’s first meeting in Step 7
 Many states have certain default provisions that can only be changed by adopting Bylaws or an
Operating Agreement
STEP 9: Opening a Business Bank Account
 Banking Resolutions - must be adopted by Board in writing, must provide a copy to the Bank
 Obtain a Federal Employer Identification Number (EIN), must give to Bank (also required to pay
wages and taxes)
 Bank may also need a Certified Copy of your Articles of Incorporation, which can be ordered at the
same time you file your Articles
STEP 10:ConsiderS Corp Election
 Requires filing Form 2553 with IRS and allows a Corporation to be taxed like an LLC
 There are limitations on the number of shareholders and the types of shares S Corps can have, make sure
you comply with these requirements
STEP 11:Other Considerations
 Application for Local Business Registration
 Assumed Name Certificate/ DBA Name
 Application to Operate Business in another
state
 Local Business License or Certification
 State Tax Identification Number (if
necessary)
 Domain Name Registration, Terms and
Conditions & Privacy Policy for website
 Trademark or Copyright of proprietary
information
 Employee Stock Options
 Form 1023 for formation of a 501(c)3 Non-
Profit

3. Copyright 2016 © Margaret A. Moon, esq.
All rights reserved.
Annual Requirements for Going Forward:
 Annual meetings of shareholders and directors
 File and pay annual statements and registration fees (if required)
 File and pay applicable taxes (income, employment, franchise, etc.)
Other Optional Documents to ConsiderHaving:
 Promissory Note/ Basic Loan Agreement
 Investment or Subscription Agreement
 Asset Purchase/ Sale Agreement
 Partnership Agreement
 Employment Agreement
 Independent Contractor Agreement
 Confidentiality Agreements
 Services Agreements
 Software/ App License Agreement
Notes for LLCs and LLPs:
 Articles of Incorporation = Articles of
Organization
 Incorporator = Organizer
 Bylaws = Operating Agreement
 Shareholder/ Shares = Member /
Membership Units
 Director/ Officer = Governor / Manager