How to Start a corporation in Rhode Island

The first step will be to decide on a name for your business. Choose a name that is memorable and unique, easy to understand and pronounce, and accurately represents your business. You'll want to search your name choices on the web to quickly find out if they are already taken. It's also best to jot down one or two alternatives, in case the name you settle on is not available for registration in Rhode Island.

There are a few rules that Rhode Island Corporations must follow in order to register a name.

• The name you choose must be unique and not "confusingly similar" to the name of any other Rhode Island business. This is to prevent fraud or misrepresentation and is a common rule in all 50 states. You can find out whether a corporate name is available in Rhode Island by using the RI Department of State Corporate Database to check name availability.

  In a pinch, you can use MyCorporation's business name search service, where we will conduct a more thorough search on your behalf and report back our findings. Plus, MyCorporation includes a business name search for free when we complete your LLC filings on your behalf!

• Your business name must include the words Corporation, or its abbreviations Corp. or Inc.

You can learn more about how to choose a business name and other important statutory information through the Rhode Island Secretary of State.

Most states require that you designate a registered agent for your business, and Rhode Island is no exception. A registered agent acts as the state's means to communicate with a business and is responsible for receiving legal and official documents related to the business.

In the state of Rhode Island, it is required that all business entities filed in the state maintain a registered agent. This registered agent may be an individual or entity that receives official and legal documents on behalf of the business. They must be a Rhode Island resident, have a Rhode Island street address, and be available at the given address during normal business hours to accept service of process. A P.O. Box is not accepted as a registered agent address.

A member of the corporation can act as the registered agent if desired, or you may also use a third-party registered agent service like MyCorporation.

Why designate a third party to act as my registered agent?

It should be noted that registered agent information is made publicly available. This can cause privacy concerns for business owners who do not wish to list their personal contact information on the internet for everyone to see. It is also common for the registered agent to become a target of spam or robocalls since this private information is relatively easy to obtain.

Another issue that may arise is that in the case of a lawsuit, these documents would be hand delivered directly to the registered agent. In the case that you used your business location for this purpose, this could occur in front of your customers. This is why many business owners opt for a third-party registered agent service such as MyCorporation to act as a registered agent on behalf of their business.

The state of Rhode Island requires you to file Articles of Incorporation (PDF) (270 KB) to form a corporation.

What information should be included in the Articles of Incorporation?

• Name of the corporation
• Total number of shares the corporation has the authority to issue
• Name and address of the initial registered agent/office in Rhode Island
• Additional provisions
• Name and address of each incorporator
• Date when Articles of Incorporation will be effective
• Print name of incorporator, date, and signature of incorporator

A filing fee of $230 is also required when submitting the Articles of Incorporation. It made be payable either by mail via check made payable to RI Department of State or in person via cash, credit card, or check at the Business Services Division. The minimum filing fee applies to the corporation unless the corporation has more than 75 million authorized shares.

Corporate bylaws are a detailed set of rules agreed upon and adopted by the board of directors after a corporation is formed, that specify the internal management structure of the corporation. They are typically drafted by the corporation's founder or directors. Corporate bylaws are not submitted to the state.

The state of Rhode Island does not require a corporation to create bylaws upon approval of the Certificate of Incorporation, but it is strongly recommended. Bylaws allow a business to maintain consistency in the way it operates and communicate organizational rules to help avoid conflicts and disputes. They cover how directors are elected, meetings are organized, and officer roster and summary of duties. In addition to management, bylaws specify details about ownership rights, annual meetings, and the addition or removal of officers and directors.

If you are not sure how to create corporate bylaws, you can purchase MyCorporation's customized Minutes and Bylaws Package. This kit provides you with the internal documents required to fulfill your corporate formalities and properly operate your business after incorporating.

The board of directors of a corporation are normally elected by the shareholders. However, for a new business, the incorporator (the person who signed the Certificate of incorporation) will often designate the initial directors if there are no initial directors named in the certificate of incorporation.

This is done by creating the "Statement of Incorporator" which will list the names and addresses of the initial directors of the business. The statement of incorporator is then signed by all of the incorporators, which passes all elements of control over to the initial directors.

This is filed not with the state, but in a corporate minute book of the incorporation. It is kept as part of the corporate record.

The first meeting of the board of directors is an important time in the life cycle of a corporation. During this meeting, the initial directors of the business will adopt the corporate bylaws, set the fiscal year, and appoint corporate officers. It is also common to authorize the issuance of shares of stock to the founders of your company, usually in exchange for assets.

This meeting, and all future meetings of the board of directors, must be recorded in corporate minutes. Minutes are documents that detail what was discussed and any decisions the business makes during meetings. They are stored with the corporate records.

Corporate minutes are required for all Rhode Island corporations by law. Falling behind on keeping and maintain minutes can jeopardize the corporation's liability protection and overall tax advantages. It is important to maintain updated corporate minutes and keep copies of all the signed and approved minutes or actions by unanimous consent from any special or annual meetings of the corporation's shareholders and directors.

Stock is a representation of ownership in your corporation. When your shareholders purchase stock, they are buying a small piece of your business. Although it's not legally required, it is common that most corporations will issue paper stock certificates to their shareholders.

In a private company (not publicly traded on the stock market), you can set the value to each stock however you see fit in your corporate bylaws. For example, one share could be worth $10 or $10,000, either would be completely acceptable.

Rhode Island has plenty of license types available for small businesses ranging from auto body to upholstery. Visit the State of Rhode Island Department of Business Regulation to view a complete list of the professions that require business licenses in in Rhode Island. Then, apply for the relevant business licenses or renew an existing license.

In the event that you need a bit of help, you may also turn to MyCorporation's business license compliance package. Our skilled professionals will do the work for you. We identify all of the licenses required by your business and provide you with the information you need in order to file.

An EIN (also referred to as a Federal Tax ID) is a nine-digit number that is issued by the IRS and used to uniquely identify your business for tax purposes. Think of it as a Social Security Number (SSN) for your business, except an EIN is less sensitive. It is important to wait until the LLC has been approved by the state before applying for an EIN. For that reason, filing for an EIN is one of the last things to do when you are setting up a business.

• Open business checking, savings, or investment accounts
• File taxes for the business
• Complete payroll for employees if applicable
• Obtain lines of credit and credit cards, as well as "build credit" for your business
• Apply for applicable business licenses when required.

You will only need a few pieces of information to file including your mailing address and legal business name. You can apply online with the IRS by downloading IRS Form SS-4 (PDF)(116 KB), or work alongside a third party organization like MyCorporation to complete an EIN application.