With new businesses forming every day, there has been a movement to make the process of incorporation easier and online! There are tons of websites offering to guide you through this process. To make it easier for you, we’ve simplify this choice down to two: Incorporate.com or Harvard Business Services.
Regardless of which service you choose, you’ll want to make sure you receive 3 things:
- #1. Federal Employer Identification Number (FEIN) - This number is your identification criteria for the IRS. You can think of this in the the same way you think of your Social Security number, only for your business. As with social security number, your business will need this number for so many reasons as you go forward.
- #2. Registered Agent - Your registered agent is the individual or organization appointed to you (by the service you choose) who will serve as the point of contact between you and the government. They will be your contact in forwarding on your documentation, as well as in an ongoing capacity for things like your annual report form.
- #3. Articles of Organization - This document is essentially your announcement of the business. Your articles of organization detail the initial statements you need to make as a business to form your LLC.
Both incorporate.com and Harvard Business Services (HBS) offer access to all three of these features. Either will take you through the process in a way that is both easy to understand and time-efficient. By signing up for “The Essentials” package on incorporate.com and answering their questions, you will receive all three pieces explained above. HBS requires two steps: answering questions to receive your FEIN and articles or organization, then signing up for your registered agent. Once you receive all 3, you’re set to go!
If you’ve taken the time to look at either website already, you’ll likely notice that there is a lot of talk about the State of Delaware. Don’t worry, you’re in the right place! From a startup perspective, incorporating your business in Delaware sets you up for success...here’s why!
Like most laws, each state decides what it will require people to do when they establish businesses. This offers states the opportunity to be “small business friendly”, and Delaware is consistently thought of as one of the most friendly.
Delaware business laws are both flexible and have been around for a while, meaning it is easier to predict how courts will rule in cases based on the large amount of precedents. Relative to other states, Delaware has been establishing a legal framework to support businesses for decades. They even have a business court called the Court of Chancery, which makes legal interactions less costly and more time efficient for businesses.
Looking for more info on why Delaware is a good choice? Check out a great summary from Investopedia.
We know this is a lot to take in and feels like a big decision...after all, this is the formation of your business foundation! Don’t let the legal terms scare you away. The walkthrough above is meant to make it easier. If you remember what the benefits of an LLC are, utilize either of the online tools to make it a quick process, and trust in the power of Delaware as a business friendly state, we’re confident you’ll be launching your business off on the right foot!