Starting a Corporation in Florida | What You Need to Know

Start a Corporation in Florida

In Florida, starting a corporation can benefit entrepreneurs looking to establish a separate legal entity for their business. Incorporating your business provides liability protection for its owners and offers potential tax benefits and a professional image. This comprehensive guide will walk you through Starting a Corporation in Florida, from choosing a corporate name to fulfilling ongoing compliance requirements. Some people consider starting a corporation since it has advantages and benefits rather than Starting an LLC in Florida.

Webinarcare Editorial Team will help you gain knowledge in starting a corporation with thorough research and market study. It would be best to cross-check all the factors in this article before forming a corporation.

What is a Corporation in Florida?

A corporation in Florida is a business organization recognized as a separate legal entity from its owners, also known as shareholders. When a corporation is formed, shareholders invest capital by purchasing shares of stock and, in return, become partial company owners. The corporation is managed by a board of directors elected by the shareholders to oversee the company’s operations and make important decisions. Corporations in Florida are required to have at least Three directors. One of the main advantages of a corporation in Florida is that it provides limited liability protection to its shareholders, meaning their assets are not at risk if the corporation incurs debt or is legally sued.

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Common Types of Corporations

Before you start with a corporation, you should know what type of corporation you will form. There are several different forms of corporations you can take into consideration, depending on your corporation’s objectives and ownership structure.

C-Corporation

C-Corporation is the most known type of incorporation. They have almost all corporate distinguishing characteristics. Profits are distributed to corporate owners who are taxed at an individual level. The corporation is taxed similarly to a business unit.

S-Corporation

S-Corporation in Florida is set up similarly to a C-corporation but has different tax implications and owner limits. An S-Corporation has no more than 100 stockholders and is not taxed separately. These business units must also file paperwork with the Internal Revenue Service (IRS) to obtain their status.

Nonprofit Corporation

Religious, educational, and charity institutions frequently use nonprofit businesses to run their operations without making a profit. Thus, a nonprofit corporation is exempt from paying taxes. The nonprofit organization’s gifts, contributions, or cash are reinvested in the company to fund its growth, future endeavors, or operations.

It is recommended to Start a Corporation in Florida if you would like to provide limited liability protection to your shareholders rather than Florida LLC. However, you may want to consult to LegalZoom’s Business Attorney before starting a business.

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How to Start a Corporation in Florida

To start a corporation in Florida, you must follow the below steps that, include choosing a corporate name, hiring a Registered Agent, appointing directors, filing for Articles of Incorporation, creating corporate bylaws, holding the initial board of directors, issuing stock, obtaining required licenses and permits, registering with state tax agencies, and annual reporting and ongoing compliance. All these steps are basic ones. It can be changed depending on the type of corporation you form and the nature of your business.

Step 1: Choosing a Corporate Name

The first step in starting a corporation is choosing an available name that complies with Florida naming rules. Most states require that the name of a corporation be distinguishable from other registered business names and include a corporate designator such as “Corporation,” “Incorporated,” “Company,” or an abbreviation thereof.

Here are some guidelines you must follow while naming your corporation in Florida-

  • Your business name must contain entity identifiers, such as “Incorporated,” “Limited,” “Corporation,” or “Company,” or an abbreviation, such as “Inc.,” “Co.,” or “Ltd.”
  • Exclude any words in your business name, such as “Trust,” “Bank,” “Credit Union,” or “Trustee,” or words related to a government agency, such as “FBI,” “State Department,” or “Treasury.”

To check the availability of your desired corporate name, you can search the Florida Secretary of State‘s business name database and Business Name Search in Florida. If the name is available, you may choose to reserve it for a specific period of 120 days by filing a name reservation application and paying the online name reservation fee of $35 and mail name reservation fee of $25. If your corporation plans to operate under a name other than its legal name, you may also need to register a fictitious or “doing business as” (DBA) name.

The DBA filing can be done by three methods, online, by mail, and in person filing., which costs around $50 Processing Fee, $10 Certificate of Status, $30 Certified Copy. In addition, the DBA’s validity in Florida is five years, which you can file in Florida Secretary of State.

You can check out How to File a DBA in Florida for clearer understanding.

Step 2: Hire a Registered Agent

Hiring a Registered Agent is essential in starting a corporation. Registered Agent is a person or company responsible for receiving important legal documents, tax notices, and other correspondence on behalf of your corporation. They ensure that your corporation remains compliant with state regulations and requirements. There are Florida Registered Agent Services to check in forming Florida Corporation. We reviewed some of the best-registered agent services and provided features as an add-on with their packages.

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Step 3: Appointing Directors

Corporations in Florida are required to have at least Three directors, though some states may require more. Directors are responsible for overseeing the corporation’s management and making major decisions on behalf of the company. In Florida, directors must be at least 18 years old and do not need to be state residents.

When appointing directors, it is essential to consider individuals who are knowledgeable, trustworthy, and capable of making sound business decisions. Maintaining a record of appointed directors, including their names, addresses, and terms of service, is also a good idea.

Step 4: Preparing and Filing Articles of Incorporation

After you appoint the initial board of directors in your Florida corporation, the next step is to write and file a Articles of Incorporation. In writing, the Florida Articles of Incorporation, the corporation name, principal place of business, the purpose of business, Registered Agent contact information, and the names and addresses of incorporators and initial board members, should be written.

To officially form your Florida corporation, you must prepare and file Articles of Incorporation with the Florida Secretary of State. The Articles of Incorporation is a legal document that outlines essential information about your corporation, such as its name, address, purpose, and details about its stock.

The specific requirements for Articles of Incorporation vary by state, but generally, the document must include the following:

  • The corporate name
  • The purpose of the corporation
  • The name and address of the registered agent
  • The names and addresses of the initial directors
  • The number of authorized shares and their par value
  • The name and address of the incorporator(s)

Once the Articles of Incorporation are complete, please submit them to the Florida Secretary of State’s office, along with the required filing fee. Fees vary by state, but in Florida, the Articles of Incorporation filing fee costs around $35 for filing in-person and by mail. It is crucial to provide accurate and complete information on this document, as errors or omissions may result in delays or rejection of your filing.

  • Online Filing: Get the online form from Secretary of State, fill it up, and submit. Don’t refresh the page during the process. It will erase everything.
  • Offline filing: Send the form by mail to New Filing Section, Division of Corporations, P.O. Box 6327, Tallahassee, FL 32314

Step 5: Creating Corporate Bylaws

Now you are done filing Articles of Incorporation in Florida, the next step is to draft corporate bylaws. While not always required by law, creating corporate bylaws is essential in establishing Florida corporation. Bylaws are the internal rules and regulations that govern the corporation’s operations and management. They outline the rights and responsibilities of directors, officers, and shareholders and provide guidelines for holding meetings and making decisions.

Key provisions to include in your corporate bylaws may include:

  • The corporation’s purpose and principal place of business
  • The roles and responsibilities of directors, officers, and shareholders
  • The process for appointing and removing directors and officers
  • The procedures for holding annual and special meetings
  • The methods for amending the bylaws and Articles of Incorporation
  • The procedures for issuing stock and maintaining shareholder records

Once the bylaws are drafted, they must be adopted by the corporation’s board of directors. Keeping a copy of the bylaws with your corporate records and updating them to reflect changes in the corporation or applicable laws is essential.

Step 6: Holding the Initial Board of Directors Meeting

The initial board of directors meeting is a crucial milestone for your Florida corporation. During this meeting, the directors will adopt the corporate bylaws, elect officers, and make other key decisions to set the foundation for the corporation’s operations.

The agenda for the initial board meeting may include the following:

  • Adopting the corporate bylaws
  • Ratifying any pre-incorporation actions taken by the incorporator(s)
  • Electing corporate officers (e.g., president, vice president, secretary, treasurer)
  • Designating a corporate bank account
  • Authorizing the issuance of stock
  • Approving necessary licenses, permits, and tax registrations

It is essential to keep detailed minutes of the initial board meeting, documenting the decisions made and actions taken. These minutes should be stored with your corporate records.

Step 7: Issuing Stock

Corporations in Florida are required to issue stock to their owners, also known as shareholders. When preparing to issue stock, you must determine the number of authorized shares and their par value, as outlined in your Articles of Incorporation. You may choose to issue different classes of stock, each with its rights and privileges, such as voting rights and dividend preferences.

The process for issuing stock typically involves the board of directors approving a stock issuance resolution, determining the price per share, and recording the issuance in the corporation’s stock ledger. Maintaining accurate and up-to-date records of all stock transactions, including transfers and cancellations, is crucial to ensure proper ownership tracking and compliance with securities laws.

Step 8: Obtaining Required Licenses and Permits

Depending on the nature of your corporation’s activities and location, you may need to obtain various licenses and permits to operate legally. These may include federal, state, and local requirements, such as:

  • A Federal Employer Identification Number (EIN) for tax reporting and employee withholding purposes.
  • State sales and use tax registration, if your corporation sells taxable goods or services
  • Professional or occupational licenses for specific industries (e.g., healthcare, construction, food service)
  • Florida Business Licenses, zoning permits, and health department approvals

Researching and obtaining all required Florida licenses and permits before commencing operations and maintaining compliance with any ongoing renewal or reporting requirements is essential.

Step 10: Registering with State Tax Agencies

In addition to obtaining licenses and permits, your Florida corporation may also need to register with various tax agencies. This may include registering for sales and use tax, obtaining an Employer Identification Number (EIN) in Florida for payroll tax purposes, and filing state income tax and franchise tax returns.

An EIN will serve as the tax ID for your Florida corporation. EIN can be obtained from the Internal Revenue Service (IRS). It is a 9-digit number similar to Social Security Number. EIN, however, is distinct from SSN. It is only used for business-related activities, particularly for submitting general taxes. The form must be completed and uploaded to the IRS website.

The application of an EIN in Florida can be through the following:

  • Apply Online- The online EIN application is the preferred method for customers to apply for and obtain an EIN.
  • Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that Form SS-4 contains all of the required information.
  • Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is four weeks.
  • Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

Each state has tax requirements, so consult a tax professional or Florida Department of Revenue for guidance on your specific obligations.

Step 11: Annual Reporting and Ongoing Compliance

Once your Florida corporation is up and running, you must fulfill ongoing reporting and compliance requirements to maintain good standing. This may include filing Annual Report with the Florida Secretary of State, updating your corporate records to reflect changes in directors or officers, and staying current on any required licenses or permits.

In addition, it is essential to stay informed about changes in corporate laws and regulations that may impact your business and to seek professional advice when needed.

Paying Your Taxes in Florida

Even if you have established your corporation in Florida, pay your taxes and keep everything up to date so you won’t pay any penalty. Unlike an LLC, there is a corporate tax that every corporation in Florida has to pay. On the other hand, they must pay income taxes based on their business income. Some other types of taxes in Florida are sales tax, franchise tax (not applicable to all the states), and other state taxes.

Cost of Forming a Corporation in Florida

In forming a corporation in Florida, a filing and Annual fee must be paid. Without it, your corporation won’t operate. A corporation’s initial filing fee may vary from state to state. However, in Florida, it costs $35 for filing in-person and by mail. The corporation in Florida also has to file an Annual Report (though it might not be mandatory, it is recommended to file one). Ensure you comply with all the necessary fees and costs so your corporation will run successfully and smoothly.

FAQs

What is the process to start a corporation in Florida?
To start a corporation in Florida, you need to file Articles of Incorporation with the Florida Division of Corporations.
How much does it cost to start a corporation in Florida?
The filing fee for Articles of Incorporation in Florida is $70.
Can I incorporate in Florida if I do not live there?
Yes, you can incorporate in Florida if you do not live there.
Do I need a registered agent to start a corporation in Florida?
Yes, Florida requires all corporations to have a registered agent who is available during business hours to accept service of legal process.
Can I act as the registered agent for my corporation in Florida?
Yes, you can act as the registered agent for your corporation in Florida.
Can I file my Articles of Incorporation online in Florida?
Yes, the Florida Division of Corporations allows you to file your Articles of Incorporation online.
How long does it take to get my corporation set up in Florida?
The turnaround time for corporation filings in Florida is generally 2-3 business days.
Can I reserve a corporation name in Florida before filing my Articles of Incorporation?
Yes, Florida allows you to reserve a corporation name for up to 120 days before filing your Articles of Incorporation.
Do I need to file annual reports for my corporation in Florida?
Yes, all corporations in Florida are required to file annual reports.
How much are the annual report fees for Florida corporations?
The fee for filing an annual report for a Florida corporation is $138.75.
When are annual reports due for Florida corporations?
Annual reports for Florida corporations are due by May 1st every year.
Can I change or restate my Florida corporation’s Articles of Incorporation?
Yes, a Florida corporation can change or restate its Articles of Incorporation by filing new Articles with the Division of Corporations.
How do I obtain a Certificate of Good Standing for my Florida corporation?
The Division of Corporations in Florida issues Certificates of Good Standing upon request.
How long does it take to obtain a Certificate of Good Standing in Florida?
Turnaround time for Certificates of Good Standing in Florida is generally around 2 days.
Are there any ongoing state-level taxes or fees for Florida corporations?
Florida requires all corporations to pay an annual Registered Agent fee of $25.
Are there any special insurance requirements for Florida corporations?
Florida does not require corporations to carry shareholders’ or directors’ liability insurance.
Can a Florida corporation sell stock?
Yes, Florida corporations may sell stock to raise capital.
Can a Florida corporation have more than one class of stock?
Yes, Florida allows corporations to have multiple classes of stock.
Do Florida corporations need to have a board of directors?
Yes, Florida corporations are required to have a board of directors.
How many directors are required for a Florida corporation?
Florida corporations must have a minimum of one director.
Are Florida corporations required to hold annual meetings?
While Florida does not require annual meetings, it is a best practice for corporations to hold them.
Can I file my corporation’s annual reports online in Florida?
Yes, Florida allows corporations to file their annual reports online.
Can I dissolve my Florida corporation if it is no longer active?
Yes, Florida allows corporations to dissolve or withdraw from the state if they are no longer active.
Are there any taxes or fees associated with dissolving a Florida corporation?
There is a $35 fee for filing a dissolution certificate in Florida.
What is the difference between an S Corporation and a C Corporation in Florida?
The key difference between an S Corporation and a C Corporation in Florida is that S Corporations are taxed as pass-through entities while C Corporations are subject to double taxation.
Can a Florida corporation elect S Corporation tax status?
Yes, Florida corporations can elect to be taxed as S Corporations with the IRS.
How do I renew my Florida corporation’s registration?
To renew your Florida corporation’s registration, file an annual report and pay the associated fee.
Do Florida corporations need to file federal income tax returns?
Yes, Florida corporations are required to file federal income tax returns.
Are there any auditing requirements for Florida corporations?
Florida does not specifically require corporations to have audits, but certain industries or agreements may mandate one.
What is the process to incorporate a business in Florida?
Business owners will need to file official documents with the Florida Department of State Division of Corporations in order to get started.
What are the requirements for incorporating in Florida?
Business owners must be at least 18 years old, choose a unique name for their business, and legally operate under a registered agent address.
How much does it cost to incorporate in Florida?
The filing fee with the Florida Department of State typically costs around $125, while registered agent services typically cost around $100 per year.
In what type of company structure can I form in Florida?
Florida allows for incorporation as an S-Corporation, C-Corporation, or Limited Liability Company (LLC).
Are there any particular industries in which I cannot incorporate my business in Florida?
Florida does not place any particular restrictions on business incorporation based on industry.
Can I incorporate a non-profit in Florida?
Absolutely! Incorporating as a non-profit is a popular choice for organizations that plan to operate as tax-exempt entities.
Do Florida corporations have to hold annual meetings?
Yes, corporations are required to hold annual meetings of both directors and shareholders every year.
Can out-of-state businesses incorporate in Florida?
Yes, out-of-state businesses are allowed to form a business entity in Florida as a domestic business.
How long does it typically take to incorporate a business in Florida?
Typical processing time for articles of incorporation is around 5-10 business days, but expedited filings are available.
Do I need a lawyer to help me incorporate my Florida business?
While an attorney isn’t required, some business owners opt to have legal counsel for peace of mind throughout the process.
How many company officers must be listed when incorporating in Florida?
At least one will be needed to satisfy Florida law.
What does a registered agent do for a business in Florida?
A registered agent is simply an individual or entity who is authorized to accept legal documents on behalf of a Florida business, such as if that business is being served with legal papers.
Can I reserve a company name before incorporating in Florida?
Yes, Florida allows potential business owners to reserve a company name for up to 120 days before beginning the formal incorporation process to ensure availability.
What happens if my company name is already taken when I file for incorporation in Florida?
If a business’s name is already taken, incorporation will not be possible until a new company name is found or created that hasn’t already been taken.
How do I know what type of corporation structure to choose in Florida?
This really depends on individual business models, so it’s important for business owners to speak with legal counsel or a financial advisor to decide which type of corporate structure works best for their specific organization.
Does the Florida Division of Corporations have different forms for different types of corporations?
Yes, the Florida Division of Corporations has a variety of forms that change based on the type of corporation being formed.
Can I file paperwork for a foreign corporation without a registered agent in Florida?
No, every foreign corporation that does business in Florida must maintain a registered agent in the state.
Can a non-resident be a registered agent for a Florida corporation?
Yes, a non-resident can be a registered agent, but someone needs to live in Florida to receive legal notices.
What do I need to do after my business is registered in Florida?
Taxation may need to be organized, and businesses should begin the process of obtaining the correct permits depending on their industries.
Are there any annual reporting requirements in Florida for corporations?
Yes, some Florida businesses need to submit an Annual Report to the Florida Department of State in order to document important info.
How do I check to see if a name is already taken in Florida?
The Florida Division of Corporations website allows potential business owners to search a database for businesses taken.
Does the name have to be unique when incorporating in Florida?
Yes, trademarks or DBA aren’t allowed, and there can be no pre-existing business that is currently doing business in Florida with the name chosen.
How do I convert my business to a corporation in Florida?
Business owners will need to file articles of incorporation to notify the Division of Corporations that they intend to restructure as a corporation.
What corporate governance documents do I need in Florida?
Incorporating businesses will need bylaws that clearly state organizing documents, bylaws, shareholder stockpool units and structurally engineering plans.
What happens if I don’t comply with Florida’s incorporation laws?
It’s likely your business will fall out of good standing with the state, which is something you will want to avoid as part of the formal business is putting all important regulations into place, take-out administration and frame statutory expectations.
What are the fees for using third-party incorporation services in Florida?
Costs vary depending on the scope of needs, price and filing formats but you can generally expect a fee of around $100 or more.
How do I dissolve a corporation in Florida?
Business owners could elect to dissolute their businesses as long as they organize correct documentation that is that adequately removes corporate structures.
How do I update my registered agent information in Florida?
Business owners should utilize the online application provided by the Florida Division of Corporations to change registered agent details from their current registered agent to a new one while it’s being effective.
Are licensed professionals permitted to incorporate in Florida?
Yes, plenty NP worth of licensed industries are totally permitted except those limited to particular issues such as bar certificates and assignments.
Can I change my corporate name in Florida after having already filed?
Yes, it is possible updating details of incorporation so calling in a business law and permits attorney that truly revises organizational documents outright should high-well .

Also Read

How to Save Money While Forming Your Florida Corporation

First and foremost, it’s important to choose the right legal structure for your business. While a corporation may offer certain advantages, such as limited liability and potential tax benefits, it can also be more costly to set up and maintain compared to a sole proprietorship or partnership. Consider speaking with a legal or financial advisor to determine which structure best suits your needs and budget.

One of the simplest ways to save money when forming a Florida corporation is to do as much of the work yourself as possible. While hiring a lawyer or legal service may seem like the easiest option, it can also be the most expensive. Many entrepreneurs have successfully formed their own corporations by utilizing online resources and guides, such as the Florida Department of State’s website, which provides step-by-step instructions for filing the necessary paperwork.

Another way to save money when forming a Florida corporation is to shop around for the best deals on services such as registered agent or bookkeeping services. Many companies offer competitive rates and discounts for new businesses, so it’s worth taking the time to compare prices before making a commitment.

Additionally, consider taking advantage of any available discounts or incentives for new businesses. Some cities or counties in Florida may offer tax breaks or other incentives to encourage small business growth. Check with your local government or economic development office to see if you qualify for any programs that could help reduce your startup costs.

When it comes to filing fees, be sure to carefully review the requirements set forth by the Florida Department of State. Avoid unnecessary fees or penalties by ensuring that all forms are filled out correctly and submitted on time. Consider using electronic filing options, such as the Department of State’s online filing system, which can help expedite the process and eliminate the need for snail mail.

Finally, consider creating a detailed budget for your corporation formation to help keep costs in check. By outlining all potential expenses, from filing fees to legal services, you can better prioritize your spending and avoid any surprises along the way.

While forming a Florida corporation can be a costly process, there are several ways for entrepreneurs to save money and avoid unnecessary expenses. By carefully researching options, doing as much of the work yourself as possible, and taking advantage of available discounts and incentives, entrepreneurs can successfully start their business without breaking the bank.

Conclusion

Starting a corporation in Florida involves several critical steps, from choosing a corporate name to fulfilling ongoing compliance requirements. Following the steps outlined in this guide and seeking professional advice when needed, you can successfully establish your Florida corporation and enjoy the benefits of limited liability, potential tax savings, and a professional business image.

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