Corporate Formation

Corporations
The Corporation is one of the crowning achievements of mankind. An entity in its own right, the corporation exists separate and apart from the personal fortunes of its founders. It can pass from its owner’s hands intact to third persons or to the owner’s heirs. It pays its own taxes, at its own tax rates, and it can sue or be sued in its own name. It can enter into contracts or partnerships and it can buy and sell real estate in its own name. Conceptually, it is a “living” thing, created by but separate and apart from its owner. Politically, it may be extended certain tax advantages not available to others as a means of achieving a specific societal goal. Indeed, the protections and advantages afforded by corporations have been central to the development of modern and free societies. National Growth Funding will provide you with the structure that is geared towards your venture while providing unlimited access to your very own Corporate Consultant Specialist!

One of the most helpful attributes of a corporation is that it can develop credit in its own right, separate and apart from its owners. Such corporate credit, if developed correctly, is not tied to the personal credit or financial liabilities of its owners. Interestingly, the proper process for establishing corporate credit helps to separate the owner’s personal finances from the finances of the business; in so doing, the liability protection afforded by the corporate veil is strengthened. National Growth Funding will file correctly for you while following every compliance step required.

National Growth Funding will make sure that every step is covered.

Choosing an Entity
Initial Filings (Acquiring EIN)
Piercing the Corporate Veil
Stock Ledger
Stock Certificates
Meeting Minutes

    A list of available entities to operate your business
                                   Which Entity to Choose
When you first decide to open a company you have a choice to make. You need to decide which entity do I form to operate my business? National Growth Funding will set you up the BEST suited Entity for your venture!
If you are looking to build business credit, the answer is simple, a LLC, C-Corporation or S-Corporation.

The S Corporation should be considered:

When the owners live in a state with no personal state income tax.
Have a small number of individuals who own the company.
Have sales less than a few million in revenue.

The C Corporation should be considered:

When the owners live outside the country.
When several individuals are involved in ownership.
When other entities are in involved in ownership.
Have revenue greater than five or six million.

When to use a Limited Liability Company - LLC

When two or more individuals are involved in the ownership.
Owning real estate for investment purposes.
Have several entities that own the business.

A comparison of some of the most common business entities is below:

National Growth Funding will take you step by step on the incorporating process. NGF will not only educate you, but assist you as well. From Choosing a name to keeping the chosen corporations in good standing and compliance. Call Us Now!! (866) 791-1291
Protecting the Corporate Veil

One of the primary benefits of incorporating or forming an LLC is the protection of the business owners personal assets from lawsuit. The main problem is that most entrepreneurs simply file the initial paperwork and then completely drop the ball on properly maintaining the corporate veil. This same rule applies whether you have a domestic, Delaware or Nevada Corporation or LLC.
This is a list of ways to maintain the corporate veil:

Always conduct business through and in the name of your entity rather than in your own name (unless you are a sole proprietor). If not, the entity will allow creditors to deny you liability protection because you did not really conduct business as an entity.
Always have the entity file a resolution to authorize action, even if there is only a “ratification” after the fact.
Use the proper form of entity signature by always signing documents in representative capacity as an agent of your entity: “ABC LLC, by John Q. Smith, Managing Member.”
Use proper signs, advertisements and business cards showing an entity rather than an individual (e.g., “John Smith, President, ABC, Inc.” rather than “John Smith, Owner/Proprietor”).
Use proper fictitious name filings.
Avoid commingling your business and personal funds in the same bank account.
Pay business and personal bills from separate accounts.
Maintain separate personal and business bank accounts.
Prepare notes and other documentation of all loans between the business and its owners.
Your entity must have a minimum capitalization reasonably adequate for the business to be conducted. Insurance counts.
Don’t sign contracts or make commitments for the business until you have filed the correct papers to organize it, since you will be personally liable. The liability shield of the corporation or LLC does not exist until the entity exists through a filing in the state capital.

Of course, our clients would already know this as a ”compliance checklist” is included in the free handbooks included with every formation of a corporation or LLC that we handle. National Growth Funding also offer a software which automates corporate/LLC record keeping of minutes and resolutions (even if you’ve forgot to do them in the past).

Beneficial Tax treatment States for Incorporating

According to a survey by one of our recent blogs, more than 50% of California small business owners think the State is headed in the wrong direction and are not optimistic about the future. Excessive regulation, health insurance prices and workers compensation insurance premiums are frequently cited reasons. National Growth Funding believe this is why about 30% of our clients who are deciding or have been formalized here in Nevada are actually from California.

Upon research, National Growth Funding have found the best 10 States to incorporate for tax treatment are:
1. Wyoming
2. South Dakota
3. Alaska
4. Florida
5. Nevada
6. New Hampshire
7. Texas
8. Delaware
9. Montana
10. Oregon
The Worst 10 States are:
41. Arkansas
42. Iowa
43. Nebraska
44. Kentucky
45. Maine
46. Vermont
47. Ohio
48. Rhode Island
49. New Jersey
50. New York
Hmmm…sounds like a great reason to incorporate in NEVADA or any of the other business friendly states!

Compliance & Government Regulations
Establish Good Standing and Protect your Assets
One of the more common reasons for incorporating your business is to protect your personal assets. This is accomplished when a corporation or LLC is formed, because it is considered a distinct legal entity, separate from its owners. Corporations and LLCs are required to follow certain federal and state regulations to remain compliant and be eligible to receive a certificate of 'good standing'. It is important for you to know the legal aspects of starting and running a business.
Each state has specific requirements for each type of entity, which if properly followed, will keep your company in compliance. These can vary by state and some of the more common items are detailed below:
Some Corporate Compliance Requirements Include:

Conduct Organizational Meeting for a Corporation - Hold initial meeting to elect officers.
Adopt Bylaws or an Operating Agreement - Prepare a written document that outlines how your business will operate.
Keep Accurate Records - Maintain financial documentation for a period of seven years.
Pay Annual Franchise Tax - Some states impose an annual franchise tax.
Pay Required Taxes - Follow the proper tax filing rules of the federal government and the state(s) where you operate and/or formed your business entity.
Conduct Annual Meeting for a Corporation- Hold an annual meeting of directors and shareholders including written minutes.
Distribute Profits Accurately - Allocate profits exactly as outlined in your bylaws or operating agreement.
Don't Co-Mingle Funds - Maintain a separate business bank account from your personal accounts and do not co-mingle funds between accounts.
Establish a Registered Agent - Maintain the name and address of your registered agent on file with the state of formation.
File Annual Statement - Provide updated information at regular intervals as required by the state.

National Growth Funding will walk you through with defining your compliance needs. To learn more, call to speak with one of our Business Associates today at 866-791-1291 or 210-301-0051. Or, you can email us at info@ngf-sanantonio.com .
Frequently Asked Questions
1. What is Legal Compliance?
Legal compliance can be described as following the rules of the state for starting and running a corporation or LLC. Each state has specific requirements for each type of entity, which if properly followed, will keep your company in compliance with government regulations.
2. What is 'good standing' and how can I show others I have it?
Businesses that follow the rules and regulations of the state, submit requested items, and pay taxes or fees timely, are considered in 'good standing' with the state. If you continue to be compliant with the state, you can request a 'certificate of good standing' for your company.

Call us today so we can customize a structure that works best for you!!