Drafting Articles of Incorporation

Note: Links to our free templates are at the bottom of this long guide.
Also note: This is not legal advice

Introduction

Forming a corporation is a big step for any business, and can provide a range of benefits, such as limited liability, the ability to raise capital, and the independence of its own legal identity. Due to this, it’s crucial that articles of incorporation are drafted properly. Articles of incorporation are the legal documents that formally establish the corporation; they name it, define its purpose and authorized capital stock, list director numbers, and contain other vital information about it.

As an experienced member of the Genie AI team - providing free articles of incorporation templates - I strongly recommend entrepreneurs and small business owners take their time to craft these documents correctly. Serving many important functions, they create an entity distinct from its owners or directors; allow for rights/responsibilities/obligations to be clearly understood by all involved; provide a structure for operations like listing director numbers and shareholder rights; plus offer crucial protections for businesses (limited liability) or potential investments (raised capital).

To summarise: The articles of incorporation are fundamental documents in any corporation’s formation process and should be skilfully created with consideration given to all angles. As we’re here at Genie AI to help you every step of the way - with our community template library full of market-standard examples - we suggest taking your time with them for best results. Read on below for our step-by-step guidance on how it’s done right…and access our template library today!

Definitions

Limited Liability: Limited liability is a type of legal protection that limits the amount of money a person can be held responsible for in the event of a legal claim or lawsuit.

Perpetual Existence: Perpetual existence is a legal concept that states that a business entity can exist forever, even after its founders or owners have passed away.

Tax Reductions: Tax reductions refer to the lowering of a person or business’ tax liability. This can be achieved through various government incentives or deductions.

Financial Flexibility: Financial flexibility is the ability to quickly adapt to changes in the financial environment. This typically involves having access to multiple sources of capital, such as debt or equity, in order to respond to market conditions.

Credibility: Credibility is the trustworthiness of a person or business. It is typically gained through having a good reputation and being seen as reliable and competent.

Articles of Incorporation: Articles of incorporation are the legal document that officially creates a corporation. This document must include certain required information such as the name of the corporation, the name and address of the registered agent, and the purpose of the corporation.

Registered Agent: A registered agent is a person or business entity that is designated to receive and handle legal documents on behalf of a corporation.

Incorporator: An incorporator is a person who is responsible for signing the articles of incorporation and filing them with the state.

Non-Profit Corporation: A non-profit corporation is a type of corporation that does not distribute profits to its shareholders, but instead uses its profits for charitable or public purposes.

C Corporation: A C corporation is a type of business entity that is taxed separately from its owners and is subject to certain legal requirements.

S Corporation: An S corporation is a type of corporation that is taxed differently than a C corporation. This type of corporation is subject to certain legal requirements and has certain restrictions on ownership and profit distribution.

Limited Liability Company (LLC): A limited liability company (LLC) is a type of business entity that offers its owners limited liability protection and tax advantages.

Filing Fee: A filing fee is a fee charged by the state when submitting certain legal documents, such as the articles of incorporation.

Statement of Information: A Statement of Information is a document that provides information about a corporation to the state. This document must be filed with the state in order for the corporation to remain in good standing.

Secretary of State: The Secretary of State is an official in a state government who is responsible for overseeing the registration and filing of businesses in the state.

Annual Fees: Annual fees are fees that must be paid on a yearly basis to maintain a corporation’s good standing with the state.

Franchise Taxes: Franchise taxes are taxes that are imposed on business entities by states or local governments.

Income Taxes: Income taxes are taxes imposed on individuals or businesses based on their income.

Property Taxes: Property taxes are taxes imposed on individuals or businesses based on the value of their property.

Annual Reports: Annual reports are documents that must be filed with the state in order to maintain the corporation’s good standing. These reports provide information about the corporation’s finances and other activities.

Tax Returns: Tax returns are documents that must be filed with the government in order to pay taxes and report income.

Corporate Records: Corporate records are documents that provide information about the corporation such as its finances, ownership, and activities.

Corporate Governance: Corporate governance is the process by which a corporation is managed and controlled. This includes appointing officers and directors, as well as establishing policies and procedures.

Officers and Directors: Officers and directors are individuals who are appointed to manage and control the corporation. They are responsible for making decisions on behalf of the corporation and ensuring that the corporation remains in compliance with applicable laws.

Contents

1. Explaining the purpose and benefits of forming a corporation
2. Outlining the legal requirements of forming a corporation
3. Identifying applicable state and federal laws
4. Explaining the process of registering with the state
5. Discussing the various types of corporations
6. Explaining how to draft articles of incorporation, including the contents of the articles
7. Describing the required elements of the articles
8. Explaining the process of filing and submitting the articles
9. Recommending documents to assist in the process
10. Explaining the role of the state in incorporating a business
11. Discussing the financial obligations associated with forming a corporation
12. Explaining the costs associated with filing and registering the business
13. Discussing the need for ongoing fees and potential tax liabilities
14. Providing tips for properly filing articles of incorporation
15. Explaining post-incorporation requirements, including ongoing filings and legal compliance
16. Explaining the need to meet ongoing filing requirements
17. Discussing the need for ongoing legal compliance
18. Discussing the need for corporate governance, including the role of corporate officers and directors

Get started

Explaining the purpose and benefits of forming a corporation

• Understand why forming a corporation is beneficial, such as limited liability, perpetual existence, and centralized management
• Know the differences between various types of business entities, such as LLCs, sole proprietorships, and partnerships
• Research the laws and regulations that govern corporations in your state
• Understand the various roles and responsibilities of a corporation, such as shareholders, directors, and officers
• Learn about the tax benefits associated with forming a corporation

You can check this off the list when you have a full understanding of why forming a corporation is beneficial and the differences between various types of business entities, as well as the laws and regulations governing corporations in your state.

Outlining the legal requirements of forming a corporation

• Research the legal requirements necessary to form a corporation in the state of formation
• Determine the filing fee associated with forming a corporation in the state of formation
• Outline the information necessary to be included in the Articles of Incorporation
• Create an initial list of the required documents that must be filed with the applicable state agency
• Research applicable state and federal laws that must be considered when forming a corporation
• Determine if the Articles of Incorporation must be filed in any other states

You’ll know you can check this step off your list and move on to the next step when you have successfully identified all of the legal requirements of forming a corporation as well as all of the necessary documents, fees, and applicable laws.

Identifying applicable state and federal laws

• Research the state and federal laws that govern corporations in the state you wish to incorporate in.
• Make sure to include the rules and regulations of the state, as well as any applicable federal laws.
• Familiarize yourself with the laws to ensure that you are in compliance with all regulations.
• Once you have reviewed the applicable laws and understand them, you can check this step off your list and move on to the next step.

Explaining the process of registering with the state

• Gather the necessary documents. You will need to submit the Articles of Incorporation to the Secretary of State in the state in which you wish to incorporate.
• Prepare a draft of the Articles of Incorporation. This document must include the name and address of the corporation, the purpose of the corporation, the duration of the corporation, the name and address of its registered agent, the amount of capital stock the corporation is authorized to issue, and the names and addresses of the incorporators.
• Submit the Articles of Incorporation to the Secretary of State. Depending on the state, you can typically submit the Articles of Incorporation in person, by mail, or online.
• Pay the required fee. Most states will require a filing fee in order to register the Articles of Incorporation.
• Receive confirmation of your filing. After the Secretary of State has processed your Articles of Incorporation, they will typically send a confirmation letter or email.

Once you have gathered the necessary documents, prepared a draft of the Articles of Incorporation, submitted the Articles of Incorporation to the Secretary of State, paid the required fee, and received confirmation of your filing, you can move on to the next step in drafting Articles of Incorporation.

Discussing the various types of corporations

• Understand the difference between the three most common types of corporations: C Corporation, S Corporation, and Limited Liability Corporation (LLC).
• Understand the differences between non-profit and for-profit corporations, including the procedures for setting up each type.
• Research the details of each type of corporation, including the advantages and disadvantages of each.
• Determine which type of corporation is best suited for your business.

When you can check this off your list: Once you have a thorough understanding of the different types of corporations and have determined which type is best suited for your business.

Explaining how to draft articles of incorporation, including the contents of the articles

• Understand the legal requirements for the state in which you plan to incorporate- each state has different rules and regulations for forming a corporation.
• Understand the purpose of the corporation, which will be included in the articles- this is the main purpose of the corporation, which can be as broad or as specific as desired.
• Choose the corporate name- it must be unique and should not be confused with other existing corporations.
• Choose the corporate address- this will be the address of the corporation’s registered office.
• Choose the number of shares to be authorized- the number of authorized shares will determine the total value of the corporation.
• Identify the incorporator- this is the individual who is responsible for filing the articles of incorporation.
• Prepare the articles of incorporation- this document should include the corporate name, purpose, address, number of authorized shares, and the name and address of the incorporator.
• File the articles of incorporation with the state- once the articles are completed, they must be filed with the state in order for the corporation to be legally recognized.

You will know that you can check this step off your list and move on to the next step when you have successfully filed the articles of incorporation with the state.

Describing the required elements of the articles

• Identify the purpose of the corporation
• Name the corporation
• Identify the address of the corporation’s registered office
• Identify the names and addresses of the incorporators
• Identify the amount of stocks the corporation is authorized to issue
• Identify the classes and series of stocks
• Identify the directors of the corporation
• Identify the duration of the corporation

Once you have included all the required elements of the articles, you can move on to the next step.

Explaining the process of filing and submitting the articles

• Determine the necessary filing fee for submitting the Articles of Incorporation.
• File the Articles of Incorporation with the Secretary of State in the state where you are incorporating.
• Submit all the required documents with the Articles of Incorporation.
• Check the status of your filing.

You’ll know you can check this off your list and move on to the next step when you receive confirmation that the Articles of Incorporation have been accepted by the Secretary of State.

Recommending documents to assist in the process

• Research local laws and regulations related to incorporating a business in your state
• Research online resources and publications that provide guidance on drafting Articles of Incorporation
• Speak with a qualified legal advisor to review the documents and suggest changes
• Compile all relevant documents and information to ensure accuracy

Once you have all the necessary documents and information, you can move on to the next step: Explaining the role of the state in incorporating a business.

Explaining the role of the state in incorporating a business

• Learn about the state laws and regulations governing the formation of a corporation in the state where you plan to incorporate.
• Gather information regarding the filing fees and any other fees associated with forming a corporation in the state.
• Become familiar with the forms and documents needed to incorporate in the state.
• Have an understanding of the requirements for naming the corporation and the restrictions regarding the type of business that can be conducted under the corporate name.
• Understand the regulations governing the issuance and transfer of corporate shares.

You will know you have completed this step when you have a clear understanding of the state’s requirements for incorporating a business.

Discussing the financial obligations associated with forming a corporation

• Research the costs associated with forming a corporation, such as filing fees and incorporation fees.
• Understand the financial obligations you have to the state, such as paying taxes and any additional fees.
• Consider any additional costs associated with forming a corporation, such as hiring a lawyer or accountant to help you with the process.
• Once you have a full understanding of the financial obligations associated with forming a corporation, you can check this off your list and move on to the next step.

Explaining the costs associated with filing and registering the business

• Determine the filing fees associated with registering the Articles of Incorporation with the state.
• Calculate the cost for an attorney to review the Articles of Incorporation, if desired.
• Consider other potential costs, such as a Registered Agent fee, publication costs, or any other potential costs related to forming the corporation.
• When all costs are calculated, you can move on to the next step which is discussing the need for ongoing fees and potential tax liabilities.

Discussing the need for ongoing fees and potential tax liabilities

• Consider the cost of filing and registering the business, and make sure to factor in any ongoing fees that you may be responsible for
• Discuss the potential tax liabilities associated with the type of business you plan to start
• Make sure to understand any fees that may be associated with filing and registering the business, as well as any fees that could apply on an ongoing basis
• Seek advice from a tax professional to understand the potential tax liabilities associated with the business
• Be aware of any fees that may be associated with filing and registering the business, as well as any fees that could apply on an ongoing basis
• When you have a firm understanding of the costs associated with filing and registering the business, as well as any potential tax liabilities, you can check this step off your list and move on to the next step.

Providing tips for properly filing articles of incorporation

• Gather the required information: you’ll need your business name, address, and contact information, plus the names and addresses of all owners, directors, and/or officers
• Research your state’s filing rules: each state has specific requirements for filing articles of incorporation, so make sure to read up on the rules for your particular state
• Prepare the document: use a template or create your own, but make sure all the required information is included
• File the document with the proper state office: the document must be filed with the appropriate state office, typically the Secretary of State
• Pay the filing fee: there is usually a fee associated with filing articles of incorporation; make sure to include this when submitting your document
• Receive confirmation of filing: you’ll receive a confirmation document when your articles of incorporation are accepted, typically within 1-3 business days
• Check off this step: when you receive confirmation that your articles of incorporation have been accepted, you can move on to the next step in the process.

Explaining post-incorporation requirements, including ongoing filings and legal compliance

• Understand the post-incorporation legal requirements that must be met, such as filing annual reports, paying taxes and maintaining corporate records
• Determine the type of business entity to form and the state in which to incorporate
• Know the applicable laws of the state of incorporation and any necessary licenses or permits
• Prepare and file the necessary documents with the state, such as annual reports, franchise tax returns and other required documents
• Appoint officers or directors to handle the company’s affairs
• File for any necessary business licenses or permits
• Keep accurate records of meetings and corporate activities
• Understand the difference between corporate formalities and informal practices
• Follow the rules of corporate governance, such as holding annual meetings
• Comply with all applicable laws and regulations

You’ll know you can check this step off your list and move on to the next step when you have successfully identified post-incorporation requirements and have made any necessary documents available for filing.

Explaining the need to meet ongoing filing requirements

• Explain that the corporation must meet certain ongoing filing requirements in the state in which it is incorporated, such as filing annual reports and paying annual fees.
• Explain that the corporation must also comply with corporate laws, such as those governing corporate formalities and shareholder rights.
• Explain that failure to meet these filing requirements or comply with corporate laws can result in serious penalties, such as fines, dissolution of the corporation, or other serious legal action.
• Reiterate that it is important that the corporation comply with all filing requirements and corporate laws to remain in good standing.
• Once you’ve thoroughly explained the need to meet ongoing filing requirements, you can check this step off your list and move on to the next step.

Discussing the need for ongoing legal compliance

• Explain the importance of understanding and following local, state, and federal laws, including filing requirements, document retention and disposal, and reporting standards
• Outline the types of filings required and the timeline for filing them
• Discuss the need for tracking corporate decisions and resolutions
• Explain the need for corporate records to be maintained in an organized manner
• Discuss the need for the corporation to remain in good standing with the state of incorporation
• Explain the consequences of failing to comply with applicable laws
• Once the need for ongoing legal compliance is discussed and the team understands the requirements and consequences, this step can be checked off the list.

Discussing the need for corporate governance, including the role of corporate officers and directors

• Outline the scope of the roles and responsibilities of each corporate officer, including the CEO, CFO, COO, President, and Secretary.
• Establish the duties and obligations of each corporate director.
• Draft meeting rules and procedures for corporate officers and directors.
• Create a system of checks and balances to ensure accountability.
• Draft an agreement outlining the terms of employment and/or compensation for corporate officers and directors.

Once you’ve established the roles and responsibilities of each corporate officer and director, and created a system of checks and balances, you can check this off your list and move on to the next step.

FAQ

Q: How does someone choose the right jurisdiction for their Articles of Incorporation?

Asked by Ashley on January 15th 2022.
A: Choosing the right jurisdiction for Articles of Incorporation is an important step in setting up your company. Depending on the type of company you are forming and the industry you are in, different jurisdictions may be better suited for your business needs. For example, if your company operates in multiple countries, it may make sense to incorporate in a jurisdiction that has an international scope or that allows for cross-border transactions. Additionally, certain jurisdictions have more favourable tax regimes or different regulations that may be beneficial. It’s important to research and understand the different laws and regulations applicable in each jurisdiction before choosing one.

Q: What is the difference between Articles of Incorporation and a Memorandum of Association?

Asked by Justin on April 18th 2022.
A: Articles of Incorporation and Memorandum of Association are two documents commonly used to set up a company in the UK. The Articles of Incorporation are the rules which govern the internal management of a company and its relationship with its shareholders, directors and other members. The Memorandum of Association is the public document which sets out the name and address of the company and its purpose. The Memorandum also defines the amount of share capital that can be issued, how it can be transferred, how it can be divided among shareholders, and any restrictions on how it can be used by the company. The Articles are more detailed than the Memorandum and provide more governance over how a company is run.

Q: Is there a difference between Articles of Incorporation and Articles of Organization?

Asked by Emma on February 7th 2022.
A: Yes, there is a difference between Articles of Incorporation and Articles of Organization. Generally speaking, Articles of Incorporation are used to form corporations while Articles of Organization are used to form limited liability companies (LLCs). The articles usually include information such as the name and address of the company, purpose, duration (if applicable), rights and responsibilities of members (if applicable), capital structure, registered agent information, etc. Additionally, Articles of Incorporation often require additional steps such as registering with local or state governments before they become legally binding documents, while Articles of Organization may not require additional steps for validation.

Q: Are there any other documents I need to submit when filing for incorporation?

Asked by Michael on October 24th 2022.
A: Depending on your jurisdiction, there may be other documents required when filing for incorporation. These documents may include a Certificate of Formation or Statement of Formation (for LLCs), corporate resolutions from directors approving formation or other corporate actions, annual reports or periodic filings with state agencies (such as California’s Statement of Information), tax forms such as IRS Form 1120 (Corporations) or 1065 (partnerships), etc. Additionally, depending on your business model you may need to register with other government agencies such as the Securities Exchange Commission (SEC) or obtain specific licenses or permits from state or local agencies. It’s important to research what documents are required in order to ensure compliance with relevant laws and regulations before filing for incorporation.

Q: What happens if I don’t file my articles properly?

Asked by Tyler on August 11th 2022.
A: Filing your articles improperly can have legal consequences depending on your jurisdiction. In some cases, failure to properly file documents can result in administrative fines or penalties imposed by government agencies such as state business offices or secretary of state offices. Additionally, other parties may bring claims against you if they feel they have been harmed due to improper filing or failure to file articles properly at all. If you are unsure about how to properly file articles, it is best to seek legal advice from an experienced attorney who can help guide you through the process correctly and ensure compliance with applicable laws and regulations.

Q: What do I need to include in my Articles of Incorporation?

Asked by Hannah on July 28th 2022.
A: Your Articles of Incorporation should include key information about your business such as its name, purpose, registered agent information, capital structure (if applicable) and any special provisions you want included such as voting rights for shareholders or restrictions on transferability of shares among others. Additionally, depending on your jurisdiction you may need to include additional information such as details about members/shareholders/directors/officers/etc., any restrictions on activities carried out by the company or governing rules for internal management such as meeting requirements for directors/officers/shareholders etc., taxation details etc., all in accordance with relevant laws and regulations in force at that time. It is important to ensure that all necessary information is included in your articles so that they are legally binding documents once filed with relevant government agencies.

Q: Are there any specific requirements or restrictions when naming my corporation?

Asked by Joshua on June 13th 2022.
A: Generally speaking, when naming your corporation there are certain restrictions that must be followed depending on your jurisdiction and type of entity being formed (e.g., LLC vs Corporation). Typically these restrictions involve avoiding names that could be confused with existing businesses or trademarks; avoiding restricted words such as “bank”; avoiding profanity; using proper grammar; using capital letters where appropriate; using descriptive words related to what your business does; etc., all according to relevant laws and regulations applicable at that time in your jurisdiction(s). Additionally it’s important to make sure you conduct proper research prior to selecting a name for your business to avoid potential trademark issues down the line if someone else has already registered a similar name as theirs beforehand.

Q: Can I use a lawyer or other professional service provider when drafting my Articles?

Asked by Matthew on May 25th 2022.
A: Absolutely! Using a lawyer or other professional service provider can help ensure that everything is done correctly when drafting your Articles so that they comply with relevant laws and regulations applicable at that time in your jurisdiction(s). A lawyer can help you understand any complicated legal issues related to setting up a corporation so that everything is done properly from start to finish; provide guidance around naming conventions; advise around capital structure; explain potential risks associated with forming a corporation; assist with filing paperwork correctly; provide advice around shareholder rights; etc., all according to relevant laws in force at that time in your jurisdiction(s). An experienced lawyer will also be able to provide helpful insight into any potential challenges associated with forming a corporation so that you can make informed decisions going forward.

Example dispute

Suing a Corporation with Articles of Incorporation

• A plaintiff may raise a lawsuit against a corporation based on the articles of incorporation.
• This is because the articles of incorporation are binding legal documents that outline the rights and responsibilities of the parties involved in the corporation.
• The plaintiff may be able to prove that the corporation violated their rights or responsibilities as outlined in the articles of incorporation.
• The plaintiff may seek monetary damages for any losses incurred as a result of the violation of the articles of incorporation.
• The court may also order the corporation to make changes to their operations or policies in order to comply with the articles of incorporation.
• Settlement of the lawsuit may be reached through negotiation or mediation, or the court may issue a judgement on the case.
• If damages are awarded, they may be calculated based on the amount of financial losses suffered by the plaintiff, or based on the amount of harm caused by the corporation.

Templates available (free to use)

Articles Of Amendment Of Articles Of Incorporation Georgia
Articles Of Amendment Of Articles Of Incorporation Louisiana
Articles Of Amendment Of Articles Of Incorporation Maryland
Articles Of Amendment Of Articles Of Incorporation Minnesota
Articles Of Amendment Of Articles Of Incorporation North Carolina
Articles Of Amendment Of Articles Of Incorporation Virginia
Articles Of Amendment Of Articles Of Incorporation Washington
Articles Of Incorporation Benefit Corporations California
Articles Of Incorporation Close Corporations California
Articles Of Incorporation Florida
Articles Of Incorporation General Shares Corporations California
Articles Of Incorporation Georgia
Articles Of Incorporation Louisiana
Articles Of Incorporation Maryland
Articles Of Incorporation Michigan
Articles Of Incorporation Minnesota
Articles Of Incorporation Missouri
Articles Of Incorporation Nonprofit Public Benefit Corporations California
Articles Of Incorporation North Carolina
Articles Of Incorporation Pennsylvania
Articles Of Incorporation Professional Corporations California
Articles Of Incorporation Social Purpose Corporations California
Articles Of Incorporation Virginia
Articles Of Incorporation Washington
Certificate Of Amendment Of Articles Of Incorporation California
Certificate Of Amendment Of Articles Of Incorporation Missouri
Certificate Of Amendment To Articles Of Incorporation Michigan
Certificate Of Amendment To Articles Of Incorporation Nevada
Certificate Of Correction Of Articles Of Incorporation California
Restated Articles Of Incorporation California

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