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Everything you need to know about Corporations, LLCs and Trademarks.
Learning center
Everything you need to know about Corporations, LLCs and Trademarks.
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In-Depth Incorporation FAQ
What are corporate formalities?
In order for the business to continue as an officially recognized corporation or LLC after incorporation, states require that companies follow certain "corporate formalities" and keep accurate records of their activities. There are basically three prongs of the corporate formality requirement: the corporate records requirement, the annual reporting requirement, and the meeting requirement.
Corporate Records Requirement
Although this requirement varies from state to state, it generally compels a Corporation or LLC to maintain certain past and present corporate records at its principal office. Such records may include the current Articles of Incorporation, the Corporate Bylaws (Operating Agreement), minutes of shareholder and director meetings, written communications between the shareholders and the Corporation within the last three years, the Corporation's stock transfer ledger, the names and addresses of current shareholders, directors and officers, the most recent annual report and the financial records from the last three years.
Annual Reporting Requirement
Most states require that Corporations and LLCs file a statement and pay a moderate fee on an annual or biennial basis. This filing requirement, which is generally referred to as an "Annual Report" or "Franchise Tax," updates the state government as to the status of the company, and permits the company to continue in existence.
Meetings Requirement
The organizational meeting is the official meeting that must be held after incorporation, signaling the commencement of the corporation of LLC . There are two types of meetings that a company must hold on a continuing basis. The corporate shareholders (or LLC members) are entitled to at least an annual shareholder meeting and the board of directors (or LLC board of managers) is required to hold periodic meetings throughout the year.
Corporate Records Requirement
Although this requirement varies from state to state, it generally compels a Corporation or LLC to maintain certain past and present corporate records at its principal office. Such records may include the current Articles of Incorporation, the Corporate Bylaws (Operating Agreement), minutes of shareholder and director meetings, written communications between the shareholders and the Corporation within the last three years, the Corporation's stock transfer ledger, the names and addresses of current shareholders, directors and officers, the most recent annual report and the financial records from the last three years.
Annual Reporting Requirement
Most states require that Corporations and LLCs file a statement and pay a moderate fee on an annual or biennial basis. This filing requirement, which is generally referred to as an "Annual Report" or "Franchise Tax," updates the state government as to the status of the company, and permits the company to continue in existence.
Meetings Requirement
The organizational meeting is the official meeting that must be held after incorporation, signaling the commencement of the corporation of LLC . There are two types of meetings that a company must hold on a continuing basis. The corporate shareholders (or LLC members) are entitled to at least an annual shareholder meeting and the board of directors (or LLC board of managers) is required to hold periodic meetings throughout the year.
