Incorporating Business in Utah: What You Need to Know
Articles of incorporation utah
If you’re thinking of incorporating your company, it simply means that you’re setting up a body that is legally distinct from you. This means in case a corporation goes bankrupt, you are not held personally liable. A corporation can own property and enter into contracts. It can also be sold and continue operating without your involvement.
This blog post will share the fundamental steps you should be aware of regardless of whichever state you seek to incorporate your business in. Please contact the LegalRegistration.com team if you have any questions
1. Select a Company Name
The name selection process is one of the most exciting aspects of establishing a business. Your inability to use a name that is already in use is the main legal prerequisite. You can check the availability of any name you might like to use through the company search service provided by your state.
Also, you should think about if the name you choose already has a decent web domain name available online by using a web hosting service. You should also think about whether you want to brand your business with a trademark or logo. To be sure your trademark concept is original, you can check the United States Patent and Trademark Office USPTO. Get more information Legal Registration Archives
2. Select a Location
Even while you don’t necessarily need to rent office space, your company still needs a suitable address. Businesses must follow codes and regulations since many state and local governments have restrictions on where they can be located.
There are several inexpensive possibilities for a business address. Shared workplaces and virtual offices run by businesses like WeWork are becoming more and more common. You might try to get a sublease for an office space or even start your business out of a rented PO Box.
3. Choose a Preferred Corporate Structure
You can pick between two types of corporate entities:
4. Companies with Limited Liability (LLCs)
Numerous small firms begin as LLCs. A mixture of a corporation and a partnership is an LLC. The LLC is owned and controlled by its members, and each member possesses ownership interests totaling 100% of the business.
When you submit Utah articles of incorporation to your state government, an LLC is established. The Utah articles of incorporation serve as a registered agent for the serving process and list the members, managers, and other key parties. For additional information Category
5. Corporations (Inc.)
Your other choice is how to set up an s corp in Utah (a conventional corporation) as a C corporation or an S corporation. S and C corporations differ significantly in a number of important ways.
Typically, C corporations are sizable, publicly listed companies. A C corporation is controlled daily by officials in the C-Suite who are employed by its board of directors and owned by its shareholders. C businesses must pay taxes twice: once when profits are earned and once again when they are distributed to shareholders. On the stock market, C corporation shares can also be bought and sold.
Smaller enterprises are often the target market for S corporations. S corporations have the option of either having their firm subject to regular taxation or being classified as a pass-through organization. The proprietors of the second option use their own tax returns to pay the business’ taxes.
6. Manage Your finances.
The next step is to open up a corporate bank account for business spending once your corporation has an official name and EIN.
A corporate bank account proves the legitimacy and independence of the company, as well as the owner’s legal separation from the company. Additionally, it facilitates taxes and accounting and offers the advantage of the corporate shield and the liability protection it entails.
After establishing corporate banking, you and your accountant will talk about the best taxation strategy for your company. As was covered in Step 3, the majority of S corporations and LLCs qualify for pass-through taxation, whereas C corporations are frequently subject to double taxation. Check out the article Hit & Run
The Advantages of Incorporating Your Business
1- Transfers of ownership are simpler.
A corporation is a distinct legal body whose assets are not directly owned by its shareholders. They instead possess stock in the company, which is the actual owner of the assets. As a result, it is significantly simpler to transfer ownership interests.
It is simpler to draw investments thanks to this capability of ownership transfer. For example, venture capital companies and angel investors want to know that they may enter and exit an investment on pre-determined terms without delays brought on by a convoluted organizational structure. Additional information Business Licensing
2- Endless life
The fact that incorporated enterprises have a potentially endless lifespan is their second major benefit. When a shareholder passes away, their shares are either sold or the proceeds are distributed to their beneficiaries. On the other hand, sole proprietorships end when their owners pass away. For additional information What services do we provide?
3- Immediately credible
Having your company incorporated may provide it with an instant reputation boost. Potential investors, lenders, suppliers, clients, and workers will all be able to see right away whether you’re serious and considering the long term.
However, establishing a firm does come with some extra expenses and work. Accounting records for a corporation must be kept separately from those of its owners. Additionally, yearly registration costs must be paid, and separate financial reports and tax returns must be filed by corporations.
However, if your objective is to expand your company into a long-term, sustainable organization, then these inconveniences are worthwhile.
4- Increased access to grants and capital
According to Laura Didyk, Vice President, Client Diversity, “This manner of business may also make it simpler to attract finance and receive grants.” Additionally, corporations will get greater interest from venture capital companies or angel investors who can be asked to invest in the expansion of the company. Get more information Sole Proprietor