Easy Questions  
Free Legal Documents

Guide to Incorporating your Business in Atlas, MI

Guide to Incorporating your Business in Atlas, MI


The great corporations of this country were not founded by ordinary people. They were founded by people with extraordinary intelligence, ambition, and aggressiveness.
 
- Daniel Patrick Moynihan


What is a Corporation?
A corporation refers to a group of people authorized to operate as a single entity. It is managed by a board of directors who administer its general affairs. Corporations are capable of owning a property and do business. It can also open a bank account under its own name.

Forming a Corporation

For a corporation to exist, "Articles of Incorporation" are filed with the Secretary of State. In some states, this document is known as "Certificate of Incorporation" or "Certificate of Formation."

Different Types of Corporations

The main difference relates to the two ways an IRS allows a corporation to be taxed: "C Corporation" and "S Corporation."

C Corporation

In a "C Corporation" corporate income (1st tax) is the source of its corporate tax. Then it will distribute the profits of the corporation to its shareholders who are liable to pay taxes out of those dividends (2nd tax). This is referred as double taxation because the C Corporation is taxed on two levels.

S Corporation

A corporation that elects to be treated as a pass-through entity is referred to as an "S corporation." All corporate income is "passed-through" to the shareholders directly, who in turn list the income on their individual tax returns. An "S Corporation" is not subject to double taxation and its accounting is easier than a "C Corporation."

Benefits of Forming a Corporation

A corporation can help reduce your taxes. It can also protect your assets. It can also shield you from liability for losses of a business. Without the corporate veil, you would have to pay the debts of the businesses you owned out of your personal assets. In a corporation, however, you are shielded from this liability, so more people are willing to invest in this type of business venture. Presently, corporations have become the standard for many business entities.

Tax Advantages of Corporations Income Shifting

A "C Corporation" even with its double taxation, can still offer tax flexibility because of income shifting. You can use income shifting to take advantage of lower income brackets. For example, raising or lowering the owner's salary can shift income from the "C Corporation" to the owner giving the owner flexibility to choose the ideal tax bracket for the corporate entity and for personal taxes.

Sole Proprietorship and Partnership

Corporations have a lot of advantages and only some disadvantages over partnerships and sole proprietorships.

Advantages:

• Corporate shareholders are not liable for corporate debts.

• Corporations offer self-employment tax savings

• Corporations have continuous life

• Corporations make raising money easier

• Transferring the ownership interests of a corporation is easier

Disadvantages:

• Sole proprietorship and partnership cost less to establish

• Minimal formalities required for sole proprietorship and partnership

• Sole proprietorship and partnership are not accountable for unemployment insurance

Corporation vs. a Limited Liability Company

Limited liability company (LLC) combines the simplicity of a partnership and personal liability protection of a corporation with the tax benefits.

Advantages of a corporation over LLC:

• Corporation profits are not subject to Social Security and Medicare taxes

• Corporations garner greater acceptance

• Corporations can offer a greater variety of fringe benefits with fewer taxes

• Corporations lower taxes through income shifting

Advantages of LLC over a corporation:

• LLCs have fewer corporate formalities

• LLCs have no ownership restrictions

• LLCs have the ability to deduct operating losses

• LLCs have tax flexibility

Choosing a State for Incorporation

Most people want to establish business in their home state. It would be practical to check if your home state has a high corporate tax or high state fee. You can do business elsewhere if that is the case in your chosen state. Business involves more than just selling products; it requires having active presence and or occupying an office.

Procedures for Forming a Corporation in a Particular State

Most states have the same basic process for incorporating. Variations will be on state filling fees, bylaws, continuing obligations, and formation requirements.

Foreign Corporations

A Foreign corporation refers to the registration of a corporation in each state where they do business outside of their state of incorporation. This process is called foreign Qualification.

Managing the Corporation

Approving major business decisions are done by the board of directors who manages the corporation. Directors are elected by the shareholders and hold office for a limited term. Here must be at least one director in a corporation. Some of the procedures approved by the board of directors include:

• Declaration of dividends

• Setting the terms of employment of the elected officers

• Amending the articles of corporation and bylaws

• Corporate transactions involving mergers and reorganizations

Owners of a Corporation

The ultimate owners of the corporation are the shareholders or stockholders. They don't have the right to direct the daily activities of the corporation yet they have the right to share the profits of the corporation, elect directors, and vote on major corporate actions.

In order to elect directors, a corporation is required to hold annual shareholders' meeting. If not all shareholders are present, the meeting can still go on through a conference call or by letting shareholders signed the approved actions as discussed during the meeting.


Corporate Stock

Corporate stocks have two levels, the common stock and the preferred stock. Common stock is the most basic level of stock and it is the ownerships' share in a corporation accompanied by the rights to vote on corporate policy and management. It is the usually the only kind of stock with the voting rights.

Shareholders and Directors for a Corporation

To run the company, a corporation should have at least one director and one shareholder.

Appointing Corporate Officers

Corporations have at least three officers: a president, a treasurer or financial officer and a secretary. These officers are appointed by the board of directors to run the day-to-day operations of the corporation. They don't have to be shareholders or directors; in most cases the same person can hold all offices.

Required Officers for a Corporation

A corporation must have a president, secretary and treasurer in most states. In most cases, one person can hold all three offices.

How Corporations are Taxed

A corporation, being a separate legal entity, submits their tax return each year with the IRS. If the corporations' fiscal year ends in December 31, tax returns are due on Mach 15. Tax return must be filed even if it does not have a tax due or income. C corporations file their tax returns using the Form 1120 or 1120A. S corporation are not required to pay federal taxes at corporate level but they still must prepared a separate tax return using Form 1120S.
 
Personalize & Print a Free MI Last Will Download this Document
Page 1
Page 2
Page 3
Page 4
Page 5
Page 6
Page 7
Page 8
Page 9
Page 10
 
Personalize & Print a Free MI Living Will Download this Document
Page 1
Page 2
Page 3
Page 4
Page 5
Page 6
Page 7
Page 8
Related Legal Services near Atlas, MI
Total Attorneys - Bankruptcy
PO Box 271785
Detroit, MI 48211
(313) 335-9527
Bankruptcy Law Attorneys,  Attorneys,  Banking & Mortgage Law Attorneys,  Bankruptcy Services,  Lega
Cint Tine
7850 Haggerty Rd
Belleville, MI 48111
(734) 957-9091
General Practice Attorneys
Mcclure Richard P
122 South St
Belleville, MI 48111
(734) 697-8392
Attorneys
Canjar Gary J, JD
6810 S Cedar St
Lansing, MI 48911
(517) 694-7710
Attorneys,  Probate Law Attorneys,  Personal Injury Law Attorneys,  Traffic Law Attorneys,  Automobi
Mendez Janet A
3380 Pinetree Rd
Lansing, MI 48911
(517) 394-7500
Attorneys, Business Law Attorneys, Legal Service Plans
Sinas Dramis Brake Baughton & McIntyre
3380 Pine Tree Ln
Lansing, MI 48911
(517) 394-7500
Accident & Property Damage Attorneys,  Attorneys,  Family Law Attorneys,  General Practice Attorneys
Harper, Mark C - Sinas Dramis Brake Boughton
3380 Pinetree Rd
Lansing, MI 48911
(517) 394-7500
Divorce Attorneys,  Attorneys,  Criminal Law Attorneys,  Family Law Attorneys
Goldman, Suliman PLLC
287 Industrial Park Dr
Belleville, MI 48111
(734) 699-7360
Attorneys,  Civil Litigation & Trial Law Attorneys,  Child Custody Attorneys,  Divorce Attorneys,  D
Miller, Barbara Rogalle
321 Main St
Belleville, MI 48111
(734) 697-7177
Attorneys, Family Law Attorneys, Probate Law Attorneys, Legal Service Plans, Child Custody Attorneys
Dua & Associates
7045 S Cedar St
Lansing, MI 48911
(517) 346-7000
Viterna Law
175 2nd St
Belleville, MI 48111
(734) 325-6986
Military & Veterans Law Attorneys, Attorneys
Express Probate of Michigan PLLC
321 Main St
Belleville, MI 48111
(888) 681-6812
Justice Courts,  Probate Law Attorneys,  Elder Law Attorneys,  Attorneys,  Family Law Attorneys,  Wi
Elder Brian K
301 W Midland Rd
Auburn, MI 48611
(989) 662-6151
Estate Planning Attorneys, Attorneys, Wills, Trusts & Estate Planning Attorneys, General Practice At
White Thomas A Attorney-At-Law
35 Main St
Belleville, MI 48111
(734) 697-6010
Attorneys
McKenzie & Talaska PC
108 S Moore St
Bessemer, MI 49911
(906) 663-4771
Attorneys, Criminal Law Attorneys
Korpela & Kauppi
215 S Sophie St
Bessemer, MI 49911
(906) 663-4544
Divorce Attorneys, Family Law Attorneys, Attorneys
Morth Mi Family Law Group
35 Main St
Belleville, MI 48111
(734) 699-3845
Attorneys
Dipietro Thomas
557 Main St
Belleville, MI 48111
(734) 697-3800
Attorneys, Legal Service Plans
Pomann John J
46775 S Interstate 94 Service Dr
Belleville, MI 48111
(734) 699-3611
Attorneys
Jedo Law Firm PLC
6035 Executive Drive, Suite 21
Lansing, MI 48911
(517) 580-3396
Legal Service Plans,  Bankruptcy Law Attorneys,  General Practice Attorneys,  Immigration Law Attorn
Jedo Law PLC
6035 Executive Dr
Lansing, MI 48911
(517) 580-3396
Bankruptcy Law Attorneys
Legal Services of South Central Michigan
3490 Belle Chase Way
Lansing, MI 48911
(517) 394-2985
Attorneys, Legal Service Plans
Total Attorneys - Bankruptcy
PO Box 271802
Bay Shore, MI 49711
(231) 769-0917
Bankruptcy Law Attorneys,  Attorneys,  Banking & Mortgage Law Attorneys,  Bankruptcy Services,  Lega
Taylor David Lee
3100 Pinetree Rd
Lansing, MI 48911
(517) 393-0600
Attorneys, Legal Service Plans
12Law.com   |  NASHVILLE, TN USA   |  CONTACT US