Accounting Solutions Service

Besides visa and immigration services, CAIS also specializes in the formation of entities or managing those. CAIS has assisted clients in forming a number of entities as per their needs and requirements. CAIS has a very efficient and skilled team which fulfills client requirements on time.

Forming a Corporation

Whether one wishes to incorporate or form a corporation in the state of California or any other state of the U.S., CAIS assists them with the process. While most clients need to get the preparation as well as the filing done, some wish to only get the filing done of the documents created by them.

A corporation is sometimes referred to as the C Corporation. It is an independent legal entity that is owned by its members called the stakeholders. However, for any debts or losses, not the stakeholders but the business itself is responsible. The corporation structure is quite complex in nature and involves a lot of fees and other legalities.

Advantages of Corporation

  • The Corporation has a limited liability, that is, in case of business debts or other actions the personal assets of shareholders are not affected.
  • A corporation needs to pay taxes, unlike an LLC. Also, the owners of the Corporation need to pay their individual taxes.
  • A corporation can rCAISe its funds by selling stocks that it holds.
  • Most potential employees find Corporation to be highly competitive in terms of the partial ownership they offer through the stocks they hold.

Requirements

An individual who wishes to form a corporation needs to know the following points:

    • Type of Corporation he/she wishes to form or incorporate
    • Selection of a company name (which is available for use)
    • Address of the corporation
    • Total number of shares he will be authorizing
    • Number of shareholders of the corporation

Steps Involved in Formation of a Corporation

  • Choosing a name for the corporation (fictitious name is allowed too)
  • Filing articles of incorporation
  • Obtaining business license and permits
  • Hiring employees and starting with the business

For the formation of a corporation, the articles of Incorporation need to be filed with the secretary of state. Additionally, EIN or the Federal tax ID number is to be obtained from the IRS. Once the corporation is formed, it is necessary to file the first annual statement of information with the state within the first 90 days.

Forming an LLC

LLC refers to Limited Liability Company. This type of company is a hybrid structure such that it has various limited liability characteristics of a corporation, it is tax-efficient and is quite flexible in terms of its operation just like in a partnership. For LLC, its owners are called members.

Advantages of forming LLC

  • The LLC structure doesn’t involve any taxes at the business level.
  • The profit and loss allocation is more flexible in this structure.
  • The members are not responsible on a personal level for any debts or liabilities arising into the LLC.
  • In case any new members are to be added to the LLC, a written consent of other LLC members is to be mandatorily obtained.
  • Company management can be easily structured by the members.
  • The LLC structure has a high credibility as compared to corporations.
  • There are almost no ownership restrictions like that in the case of a corporation.
  • The recordkeeping is limited for an LLC.

Steps Involved in Formation of a LLC

  • Choosing a business name for LLC
  • Filing of Articles of Organization
  • Creation of an Operating Agreement for LLC
  • Getting business Licence and Permits
  • Hire employees and announcement of business

Note: Not all states will follow the same sequence or require all the above steps to be followed. Therefore, is necessary to understand the rules of the state in which LLC is to be formed.

Forming a C Corporation

The default type of organization formed in California is the C Corporation. The process of forming a C corporation is very simple and involves only a few small statements in the documents of Articles of Incorporation. There is a filing fee of $100 that needs to be included too.

Requirements for C-Corporation

  • Choosing one of the three share-issuing types of corporations
  • Proposed company name and corporation address
  • Number of shares authorized
  • Opening a corporation bank account
  • Applying for Federal Tax ID (EIN) with IRS

Steps Involved in Formation of a C-Corporation

  • A C corporation is formed by filing Articles of Incorporation with California Secretary of State.
  • In addition to filing the Articles of Incorporation, it is necessary to conduct the first meeting which includes the first shareholder and director meeting to form bylaws for the corporation. These laws will govern how and who runs the organization.
  • A federation tax ID also called EIN is to be applied for with the IRS and within 90 days of forming the corporation, it is necessary to file an annual statement of Information or SOI which is a document/form describing details about the directors and officers of the corporation.

Forming an S Corporation

A corporation that has been formed in California is by default a C corporation. For forming an S corporation, a C corporation needs to be formed initially. Then it is required to be electing with the IRS to be taxed as per Subchapter S of the Internal Revenue Code or IRC. This makes a corporation into an S corporation. The reason behind choosing to form an S corporation is that it is exempt from Federal taxation.

Requirements for S-Corporation

  • Choosing one of the three share-issuing types of corporation
  • Corporate address and proposed company name
  • Number of shares authorized
  • Opening a company bank account
  • Applying for Federal Tax ID (EIN) with IRS

Steps Involved in Formation of a S-Corporation

  • A corporation is to be formed initially by filing articles of Incorporation with California SOS or Secretary of State.
  • Additionally creating a bank account and applying for EIN and conducting a formal meeting of all the owners to form the bylaws, issue the corporation shares, and appoint officers by mutual agreement.
  • The Form 2553 must be filed with the IRS for the corporation to be treated as an S type. It is also necessary to provide the first annual Statement of Information with California wherein the document must provide names of officers and directors.

REGISTERED AGENT

Each and every corporation in California must have a registered agent, an individual or company available at a particular address during work (business) hours for any kind of communications from the state. CAIS has obtained expertise in handling all such communications and reduce the burden on the client corporation.

Incorporating any business is a specialized service of CAIS. The processes that seem quite complex for any of our clients are simplified at our end. We are completely aware of the laws that prevail in each state when it comes to the incorporation of any business and this makes us one of the highly-sought filings company. To know more about our services, kindly email us at [email protected] or call us at (704) 557-0188.

Source of Information: www.uscis.gov