Thinking it’s time to start a business? Chances are somebody’s told you how easy it is to get started – maybe even a lawyer. If they’re just talking about make your entity exist – those voices are absolutely right. All you need to make your business official is filing complete, signed articles of incorporation or organization with the North Carolina Secretary of State and paying their required filing fee. But a set of filed articles isn’t the only thing you need to start a business, let alone keep it alive and in compliance.
On the simpler side, you’ll need to ensure you have account ledgers for your capital and operating accounts, that you have registered for an employer identification number (“EIN”), that you’ve established at least one (1) separate bank account for business funds, and of course your regulatory obligations. More complex? Drafting (and adopting) bylaws that make your business work the way you want it and hammering out an operating, partnership, or shareholders’ agreement to make sure the owners are on the same page about what can and can’t be done with their interests in the business. In the case of corporations, holding an initial shareholders’ meeting to elect the board of directors is required and then those directors must meet to adopt the bylaws you want in place via resolutions.
Things can get even more confusing if you’ve already been doing business as an unincorporated business like a sole proprietorship or unregistered partnership and you’ll need sound legal and tax guidance to make sure contracts and ownership are properly allocated, all while avoiding legal landmines that can cost you dearly.
Still wondering if you should incorporate after all? Not sure which business entity you should choose when you do? Follow the Garrett, Walker, Aycoth and Olson business blog or contact one of our experienced Greensboro business attorneys at (336) 379-0539.