How to form a Delaware Corporation in Three (3) Easy Steps?
Most of the entrepreneurs and startups targeting the US market consider Delaware the topmost destination due to the multiple benefits and perks offered by the State. Delaware is gaining rapid popularity when it comes to setting up businesses or startups. The State’s rules and regulations offer the best liability protection for shareholders and owners. Corporations are the most common business entities in Delaware due to the following factors:
- Business-friendly policies in the context of taxation
- Efficient corporate legal procedures supported by Delaware case law’s body
- It attracts venture capital funding
- Privacy protection for businesses as per the US norms
Delaware corporations can be categorized into four types, namely- close corporation, general corporation, non-profit corporation, and public benefit corporation. Forming a corporation in Delaware is a complex process. So, business founders will be required to follow a few rules specified by the State. Several corporations are operating within Delaware, so you should examine the type of corporation that can meet your business requirements in the first place.
While you’ll be allowed to select the entire registration process independently, it is time-consuming and troublesome. Selecting a 3rd party agent to form your company in Delaware is the best decision to mitigate the chances of issues.
However, these entities are difficult to establish. The below-mentioned steps can help form a corporation in Delaware.
Choose your corporation’s name.
According to the Delaware General Corporation Law, deciding your corporation’s name is the first major step. Follow the below-mentioned criteria when naming your Delaware’s corporation:
- Include one of the words- company, club, corporation, fund, foundation, association, incorporated, society, syndicate, limited, institute, or the foreign translations of these words. These words can also be depicted in roman letters or characters, abbreviations, without, or with punctuation.
- Don’t include terms like “bank” or “trust” when naming your corporation if your corporation won’t provide banking services.
- Avoid copyright infringement after examining the name’s availability online through the State’s search tool.
- Securing a URL or domain name for the corporate website
Although the step isn’t mandatory, it’s recommended for a business founder willing to develop a professional website for the company. A professional domain name offers instant credibility to your business. As a result, your consumers can access the business easily.
It’s crucial to determine the availability of the desired domain name. Besides, you can develop your web address or purchase it to ensure it’s free from copyright issues of other businesses.
Select a registered agent
As per Delaware Codes, all corporations within the State must have a registered agent. The registered agent will be held responsible for receiving legal papers and notices on behalf of an organization after or during its formation process. An authorized business entity or a resident in Delaware is qualified to work as a registered agent if they are currently residing in Delaware.
A company with its headquarter located in Delaware isn’t required to choose a third-party agent as it can perform the role of a registered agent on its own.
File certificate of incorporation
Certificate of formation or certificate of incorporation can function as the birth certificate of the company or evidence of the company’s registration and formation. You can file the document online or even by post through the secretary of Delaware. You’ll have to provide the following information:
- The company’s entity type and its name
- The address alongside the name of the registered agent
- The number of shares issued and the number of authorized shares
- The corporate objective
- The company’s mailing address and street address
- The mailing address, street, address, and name of the incorporate
You can check the steps required to form a Limited Liability Corporation in Delaware.