Definition
The term articles of incorporation refer to documents submitted by a business entity to a government agency to legally register the creation of a corporation. The articles of incorporation are typically submitted to the Secretary of State or Department of the Treasury using a form that is unique to each state.
The approval process involves a review of the information appearing on the form, along with the collection of a registration fee.
Explanation
While the form of an organization can change over time, business owners can choose to operate as a corporation. This provides a number of benefits, including limiting the liability of the owners, unlimited commercial life, and the ability to issue common stock.
Also referred to as a corporate charter, and certificate of incorporation, the articles of incorporation legally document the formation of a corporation. The registration process occurs at the state level, and is administered by agencies such as the Department of Commerce, Secretary of State, or the Department of the Treasury. While the fees charged and rules of compliance will vary by state, the types of information provided include:
Federal I.D. / Taxpayer Identification Number
Corporate Name
Business Purpose
Registered Agent / Incorporator
Business Address
Members / Managers
During the registration process, the state agency will perform a check to ensure the corporate name is not in conflict with another already on file. Once accepted, the corporation needs to comply with rules set forth by the state such as the requirements for non-profit organizations.
Related Terms
The term business organization refers to the form of entity used by a company to conduct business. Sole proprietorships, partnerships, and corporations are the three forms of a business organization.
Moneyzine EditorNovember 6th, 2024
The term limited liability company, or LLC, is used to describe a business structure whereby the owners and managers of that organization are afforded limited liability exposure.Moneyzine EditorNovember 6th, 2024- A business entity that is owned by only one person is known as a single or sole proprietorship. The owner of a sole proprietorship is entitled to all of the profits of the business as well as its debts.Moneyzine EditorNovember 6th, 2024
- The term partnership is used to describe an unincorporated business entity that is owned by two or more persons. Partners own assets together, share in the business profits or losses, and are typically jointly liable for debts, legal actions, and the payment of taxes.Moneyzine EditorNovember 6th, 2024
A corporation is a business that is organized as a separate legal entity from the owners of the company. Ownership in a corporation is typically determined through the issuing of shares of common stock. One of the distinguishing characteristics of a corporation is limited liability.Moneyzine EditorNovember 6th, 2024
