Incorporation Resources
Corporate & Business Types
Why Incorporate In Delaware
Incorporation Resources
Types of Businesses and Corporations Including "C" Corporations,
"S" Corporations, LLCs & Non-Profit Corporations
General ("C") Corporation
Most common type of corporation which allows for an unlimited number of stockholders. This type of entity may raise capital by the issuance of stock. Compare Fees for Incorporation by State
Close Corporation
This type of entity, where available, limits the number of stockholders to approximately 30. The stock of a close corporation cannot be publicly traded and there are some limitations on the transfer of stock.
"S" Corporation
A general corporation may elect to become an S corporation by preparing IRS form 2553 (included in our corporate kit). The corporation must make the election within 75 business days of the date of incorporation in order to elect that tax year. S corporations avoid double taxation because the profits and losses are reported on the personal tax returns of the shareholders. Recently, the maximum number of shareholders of an S corp. was increased from 35 to 75. There are some restrictions with an S corp. so we encourage that you seek advice of an accountant or attorney before making the S election.
Limited Liability Company (LLC)
The newest type of structure which is now available in all 50 states including the District of Columbia. The LLC combines the pass through taxation advantages of a partnership or S corp. and the limited liability aspect of a corporation. The main differences between the LLC and the corporation is that LLC's cannot have or issue stock and in some states the LLC can only exist for a maximum of 30 years. Compare Fees for LLC Formation by State
Non-Profit Corporation
A corporation that is restricted from having or selling stock. Any income or profit cannot be passed to the directors, officers or members. A non-profit seeking tax exempt status must apply with the IRS. We recommend that you seek assistance from an attorney or accountant when applying for tax exempt status. *We prepare generic non-profit Articles of Incorporation and therefore recommend that your attorney or accountant prepare the incorporation documents so that it meets the IRS requirements under Section 501 (c)(3).
The above information is general in nature. We recommend speaking to an attorney or accountant to find out what structure is best suited for your business.
Why Incorporate in Delaware?
According to the Delaware Department of State*:
More than half a million business entities have their legal home in Delaware including more than 50% of all U.S. publicly-traded companies and 58% of the Fortune 500. Businesses choose Delaware because we provide a complete package of incorporation services including modern and flexible corporate laws, our highly-respected Court of Chancery, a business-friendly State Government, and the customer service oriented Staff of the Delaware Division of Corporations.
Here are some of the reasons that Delaware is the most favored state for incorporation:
Ease of Formation of Delaware Corporations
A Delaware corporation or LLC can be filed the same day the order is placed with receipt of your paperwork in approximately 7-10 business days.
Cost
The cost is one of the lowest in the country. $199 includes the name check and same day preparation and filing of the incorporation documents.
No Minimum Capital
There is no minimum capital requirement when forming a Delaware corporation.
Chancery Court
The State of Delaware has a dedicated court system known as the Chancery Court. This court hears and resolves corporate matters with over 200 years of legal precedent.
One Person Corporation
One person can be the sole director, officer and shareholder of a Delaware corporation.
Delaware Tax Advantages
The State of Delaware has no sales tax, no personal property tax and no state corporate income tax provided that no business is being conducted in the State of Delaware.
Do Business in Other States
A Delaware corporation or LLC can do business in any state. However, some states will require your Delaware LLC or corporation to file as a foreign entity in their state. We recommend checking with your state prior to filing.
* From Delaware Department of State Web Site April 5, 2005
This is one of the most comprehensive pages of content you can use in preparation for creating a Delaware corporation.
Delaware Incorporation Resources
- Delaware Corporation Homepage
- Delaware Corporation & Business Entity Laws
- Pay Franchise or LLC Tax in Delaware
- Delaware Franchise Tax Calculations
- Delaware Chancery Court
- Delaware Division of Revenue
- Delaware Economic Development Office
- Delaware State Bank Commissioner
- Delaware Securities Division
- Delaware Better Business Bureau
Federal Resources
- Federal Trade Commission
- Internal Revenue Service
- Application for EIN
- Instructions for EIN Application
- Subchapter S Election Application
- Instructions for Subchapter S Election Application
- US Department of State
- US Patriot Act
- US Patent and Trademark Office
- US Securities and Exchange Commission
- Office of Foreign Asset Control
- US Small Business Administration
- Homeland Security
Legal, International and Other Resources
- US Citizenship & Immigration Services
- US Coast Guard National Vessel Documentation Center
- Dun & Bradstreet
- Countries Accepting Apostilles
- FindLaw
- Shorex
- UK Inland Revenue
News and Online Resources