Decades Of Experience Forming Corporations In Georgia
Whether you’re operating a partnership in Georgia or a sole proprietorship, or you’re interested in a startup business, forming a corporation can offer numerous benefits. As with other forms of business entities, individuals often choose to incorporate or carry out a business enterprise and limit their liability to customers and other third parties in the operation of that business. Choosing the right corporate entity, however, takes some guidance from a skilled business law attorney.
Since 2001, the lawyers at Jones & Walden, LLC, have been helping small and medium-sized business owners throughout the Greater Atlanta metro make sound decisions when it comes to corporate formation. We have considerable experience handling a wide variety of business formations, including C-corporations and S-corporations. When you work with our firm, you will get the same sophisticated counsel and level of experience you want from a big firm with the personalized touch of a small firm. It’s just one of the many benefits we offer here at Jones & Walden, LLC.
Understanding Corporations In Georgia
To form a corporation, Articles of Incorporation must first be filed by an incorporator (or incorporators) with the secretary of state. The incorporator may be any person or entity, whether foreign or domestic, and does not need to be a shareholder in the newly formed corporation.
In Georgia, the Articles of Incorporation must contain the following information:
- The name of the corporation which must contain the word “corporation,” “company,” “incorporated,” or “limited,” or an abbreviation of one of them
- The name and address of each incorporator
- The address and county of the initial registered office and the name of the initial registered agent
- The mailing address of the initial principal office of the corporation if different from the initial registered office
- The number of shares the corporation is authorized to issue, and the classes of shares, if applicable
In addition to the mandatory information listed above, the Articles of Incorporation may also contain any other provisions not in conflict with applicable law.
Understanding The Difference Between A “C-Corporation” And “S-Corporation”
The type of corporation must also be given due consideration prior to formation. The obvious distinction between for-profit corporations and nonprofit corporations is usually not an issue. A decision must be made, however, between forming an “S-corporation” and a “C-corporation.”
The primary distinction is that “S-corporations” are only taxed at the individual level while “C-corporations” are taxed both on corporate income and individual (i.e., shareholder) income. In other words, shareholders in an “S-corporation” report the “flow-through” of income and losses on their personal tax returns. The taxing of both the “C-corporation” and the individual shareholder is frequently referred to as “double taxation.”
While this alone may seem like a strong reason to choose an “S-corporation” over a “C-corporation,” there are many other issues involved and our attorneys can go through them with you in detail.
Finalizing The Corporation
If the original directors are named in the Articles of Incorporation, they must hold a meeting to finalize the organization of the corporation such as adopting bylaws, appointing officers, opening bank accounts and issuing stock. On the other hand, if directors are not named in the Articles of Incorporation, the incorporators elect directors to complete the organization process.
A corporation’s bylaws are analogous to an LLC’s operating agreement and generally set forth the internal rules and regulations of the corporation. Corporate bylaws may contain any provisions that do not conflict with the Articles of Incorporation and governing law.
The most common issues covered in the bylaws are:
- Voting rights and requirements
- Share allocation and transfer
- Annual and “called” meetings (and the necessity of a quorum)
- The requirements for authorizing corporate action
The bylaws are not required to be filed with the secretary of state.
Once the Articles of Incorporation, the transmittal documents, and the fees are filed with and approved by the secretary of state, the corporation may commence operations for any lawful purpose after the organization is completed as discussed above.
Get Help With Formation, Litigation And More
Business owners often have sophisticated legal needs that require equally sophisticated counsel to handle them. Whether you need help forming a corporation in Georgia or resolving a business dispute through litigation, we have the experience, skills and resources you need to address any business-related legal matter.