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According to California Corporations Code Section 200, only one (1) or more natural persons, partnerships, associations or corporations, domestic or foreign, may form a corporation by executing and filing Articles of Incorporation.

A filing fee is also required when submitting and filing your Articles of Incorporation with the California Secretary of State's office. Current filing fees are located on the Secretary of State's website. Click here for a list of filing fees.

Even though this is all that is essentially required to form a California corporation, there are a number of other tasks that need to be considered, such as, but not limited to the drafting of bylaws, election of officers, issuance of shares, scheduling regular board of director meetings, and maintaining minutes of your meetings.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

An LLC is a type of business entity that combines the personal liability protection of a corporation with the tax benefits and simplicity of a partnership or a sole-proprietorship.

Like a sole proprietorship or a partnership, the salaries and profits of an LLC are subject to self-employment taxes. With a corporation, only salaries (not profits) are subject to such taxes.

Corporations must hold regular meetings of the board of directors and shareholders and keep written corporate minutes. Members and managers of an LLC need not hold regular meetings, which reduces complications and paperwork.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

A corporation is managed by a Board of Directors, which governs and directs the corporation, as well as approve major business decisions.

The Board of Directors consists of individuals (directors) who can, but are not required to be, shareholders or an officer. The directors, in accordance with the corporation's bylaws, are elected to their positions with a term of office usually being one year, but can be longer. At no time can there be less than the required number of directors serving as outlined by the corporation's bylaws.

Officers are elected by the Board to fulfill administrative duties and responsibilities, such as managing the operations of the organization. The most common officer positions are president, secretary, and treasurer. In some cases, vice-presidents may be added to the Board to assist with other administrative tasks.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

When comparing a C with an S-type corporation, one may thing to consider is their tax treatment. The IRS allows a corporation to be taxed as either a C corporation or an S corporation.

As stated in our business setup site, C corporations are subject to a double taxation; that is, the corporation pays taxes on its net income and then the shareholders also pay taxes on the income they receive from the corporation.

S corporations have one level of taxation. Shareholders, under an S corporation, have to pay taxes on money they receive from the organization, but an S corporation does not have to pay taxes on its net income. This is commonly referred to as "pass-through taxation," where corporate profits are passed to the shareholders' personal income tax returns.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

A 501(c)(3) public charity is a nonprofit corporation who has met specific criteria and conditions to qualify as a federally tax exempt organization under IRS Section 501(c)(3) regulations.

Nonprofits who have achieved this milestone are able to provide individuals or entities, who have made contributions to the nonprofit, a tax deduction equal to the amount of their contribution. This is a great tool for encouraging contributions from the general public.

For a nonprofit to maintain their IRS tax exemption requires the nonprofit to closely monitor its nonprofit activities to ensure it regularly meets tax exemption requirements.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

The answer is, no.

Nonprofit corporations who have filed their Articles of Incorporation with the state are treated like any other corporation. That is, they are still required to pay income tax on their earnings. This includes paying the state minimum tax of $800.00.

If a nonprofit corporation wishes to become tax exempt under the IRS and/or the California Franchise Tax Board, the nonprofit would need to make application and meet specific criteria and conditions to qualify. Applying for tax exemption can be a very time consuming process, but if the nonprofit is successful, it can be well worth the time and effort.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

As stated on our business setup site, nonprofit corporations are organized and operated under one of three types: 1) public benefit (most common type), 2) mutual benefit (benefiting members only), and 3) religious.

Legitimate, state recognized nonprofit corporations can obtain private and public support, such as grants, contributions, low-cost postage rates, and obtain income tax exemption.

Individuals who form nonprofits usually have desires and goals to give back or contribute, in some way, to the general public.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

Although an S corporation shares many of the same tax characteristics as an LLC, an LLC has more flexibility and fewer restrictions on ownership than does an S corporation.

S corporations are limited to only 100 shareholders and are subject to more formalities, such as holding regular board of director meetings and maintaining corporate minutes.

On the other hand, LLCs generally are not required to hold formal meetings or maintain minutes, but an LLC owner may be subject to higher self-employment taxes.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

No. One of the many features and advantages of an LLC is that the owners are not required to hold regular meetings or have to maintain minutes. This means less paperwork and less likely to lose the coveted liability protection afforded by the LLC.

Even though the LLCs is not formally required to hold meetings, the LLC operating agreement may require such meetings. This provision is optional and is subject to review by the owners of the LLC when initially assembling their operating agreement.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.

Under most circumstances, no. Most individuals can form a corporation, LLC or any other business type on their own. There are many resources and services available to assist with your business setup, such as the Human Resources Consortium.

If you elect to use the HRC as your service provider, we will work with you personally and explain the business setup process, as well as facilitate the review and filing of the necessary forms with the state.

However, there are circumstances where you may need the assistance of legal counsel, including the services of a tax expert. You may wish to consult an attorney if you are transferring an existing business, such as a corporation to another business type. There may be conditions where such a transfer may not be recommended without sound legal counsel. There are also circumstances where a tax professional may offer invaluable assistance, such as how to determine which is the best tax treatment for your business.

To learn more and to speak with an HRC consultant, please call us at (559) 227-6115.