How to Incorporate a Business Online: 3 Key Steps to Follow

The businesses are now rippling through the internet, offering the multitude of services to the frenzy net buyers.

It is definitely a world that has made a lot of difference in everyone’s life.

Today, no business can run without an online presence. And if you are a startup and eager to learn how to incorporate a business, you would definitely like to incorporate it online, as the complete process is simple, quick and hassle-free.        

You can complete the formalities of incorporation online in any type of legal structure you would like to have your business incorporated like LLC, S Corp, or C-Corp.

The online processes make it easy for you to access paperwork and documents from your computer, tablet, or mobile phone.

It is very quick and budgeted option as compared to the offline system in which you have to dispatch forms or documents through courier, mail, or fax.  

But you must be wondering is it legal to incorporate a business online and is it a viable option in terms of time and money?

The online process is very well a legal and a quick way to incorporate. However, the filing timeline depends on the provincial or federal government processing time. It also depends on where you want to incorporate.

The time duration could be anywhere from a few days to a few weeks. But through the online process, you can initiate the process quickly and you could also see your business run smoothly and efficiently.  

Always remember that the process of the numbered corporations is quicker than the named corporations. The named corporations have to get the state approval which might take longer depending on the results.

First, let us find out the different steps that are required to incorporate before going on how to incorporate a business online:

How to Incorporate a Business Online

1. Choose the legal structure   

The most important is the type of legal structure you would like to select for your business.

This would have an impact on your tax structure, the quantum of paperwork you require for incorporation, the personal liability you could face and on your capacity to arrange money for your business.

The common forms of business are sole proprietorship, corporation, S corporation, and partnership.

And, recently businesses can also choose the Limited Liability Company (LLC) and the Limited Liability Partnership (LLP).

Unlike an LLP, LLCs have gained significant popularity among entrepreneurs and small businesses for their flexibility in terms of management and taxation. Moreover, each state has different LLC laws so if you’re planning to form an LLC in Texas, for example, you’ll need to follow the rules and regulations of that particular state.

As each business type has the different tax base, so it is very important that you carefully analyze the tax consequences and business needs.

Also read: Starting a Successful Side Hustle in Texas

2. Select the name

Find the availability of your business name. Make sure that the business name which you have chosen is available.

The process ensures that no other business entity or a person has the same name.  

Many think that they need to reserve the name, but it is not required. In fact, if you reserve it, it might slow down the incorporation process.

You need to prepare the following documents like:

Articles of Incorporation

Articles of Incorporation are the set of documents which all the business owners must furnish to the government as part of the registration process.

It includes the company objectives, list of the number of directors, share structure, share transfer and other business activities.

All these documents are required when learning how to incorporate a business.

Get EIN number

It is a nine-digit number which the Internal Revenue Service (IRS) assigns to the business entities which are operating in the United States for the identification.

You need an EIN number even if you do not have employees.

You can apply for an EIN online or through the mail. It is a single page form, in which you only need to fill some basic information.

So if you have the social security number, and know your business entity and calendar year, you can get your EIN number.

Create operating agreement

All businesses also have to create bylaws and operating agreements.

These bylaws are the guidelines about how the company manages its internal affairs like profits, losses, ownership percentages, and everything that is of concern to the business.

3. Get Permits and Licenses

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To know how to incorporate a business online, you also need to get the permits and licenses, the laws of which are different for the different states.

 You have to get federal licenses, state tax license, county permit, sign permit, fire department permit, and air and water pollution control permit etc.

You need to contact your city’s business license department to get all the necessary information about getting a business license.

The license gives you the right to start your business operations in the city.

Read also: 5 Small Business Taxes You Need to Know About

Incorporate your Business Online

By using the online process, you prevent the lengthy and tedious paperwork, that you might have assumed goes into the business formation.  

Many states allow entrepreneurs to register their business online to make the process faster.

However, if you feel the business registry office does not allow an online registration, there are many private online business registration companies to help you with the same.

 You give the basic information, and the company would take care of the rest.

These are the steps that you need to follow to know how to incorporate a business.

Fill the form

Furnish the basic information correctly, like your legal name, salutation and valid email address.

In some of the online forms, you also might be asked for your validation code. This ensures that there is no breach of the process.  

Besides, you also need to furnish the name of the leader, director or of any authorized person who has decision making authority.

Create a Password

You must generate a unique password for your online account, which you would be using to get an access to your account.

You can login to your account any time and check the status. Some online forms also seek validation code to make sure that there is no violation.

Pay the requisite fees

You only have to pay one-time requisite fees. The fees are different for each private registrar.

It also depends on the type of services you tend to opt. You have to compare the fees of the online incorporation service providers.  

Once you have completed the registration process, you will receive your “Certificate of Incorporation”.  This ensures your legal presence in the state. And displays the company number and date in which your company is formed.

Now you are ready to initiate business meetings and issue ownership shares/certificates.

About The Author

Hannah Jones is a lady on a journey to self-discovery. A traveller, music lover, soccer fan, business formation services information seeker and wanna-be entrepreneur. She has learned a lot through her escapades, and is happy to pass that knowledge on to you.

Is it legal to incorporate your business online and is it a viable option? Learn more about how to incorporate a business: