How to Set Up an S Corp in Utah: Everything You Need to Know
If you're wondering how to set up an S corp in Utah, the following steps provide a clear roadmap.3 min read
If you're wondering how to set up an S corp in Utah, the following steps provide a clear roadmap. Keep in mind that setting up an S corp requires one or more incorporators who will sign and file the required documents with the appropriate governmental entities.
- Name your corporation.
- Submit Articles of Incorporation.
- File for an EIN.
- Elect company directors.
- Create a corporate records book.
What Is an S-Corp?
An S corp, short for S corporation, is a way to set up your company that will keep your personal money or property separate from your business assets. By keeping these separate, you are protecting your property from being taken into consideration in a case against your company.
Though there will be strict guidelines for compliance if you choose to incorporate as an S orp, another advantage to creating your company under this structure is that an S corp is independent from its stakeholders. It can operate forever, even if your partner decides to sell his or her shares of the company.
Naming Your Corporation
Since no two corporations can have the same name, first check whether your chosen name is available. Contact the Division of Corporations and Commercial Code by phone or on the website. Once you've identified a name that is available, you can file an application and, they will reserve your name for up to 120 days.
Submitting Your Articles of Incorporation
You must submit your articles of incorporation to the Division of Corporations and Commercial Code of the Department of Commerce. Once you do, your company will officially and legally become an S corporation.
To file correctly, the articles of incorporation will include at least one incorporator and meet the following minimum requirements:
- List the corporation name.
- List the names and addresses of your incorporators, who must be at least 18 years old at the time of incorporation.
- State the purpose for your corporation, which you may do in a general way if you would like to add flexibility to your business.
- Name a registered agent, who will be the go-to person for notices, lawsuits, and other legal matters. The registered agent will also be in charge of getting the documents back to the corporation for appropriate action.
- State the number of shares the corporation may issue, providing a designation for each class of share if there is more than one. Also, state all regulations pertaining to the shares before issuing, such as limitations, privileges, and any rights in relation to the shares.
Filing for an EIN
From the perspective of the IRS, an EIN is the business equivalent to the TIN or Social Security number. The EIN, or employer identification number, will allow you to comply regulations and pay your taxes. Our website has more information about the tax structure of an S corp.
Electing Company Directors
You could name officers and directors as you file for incorporation, but it is not required during submission. If you decide to wait, the incorporators should gather after incorporation to vote for directors and approve company bylaws, if any.
After having elected the directors, the incorporators will not be responsible for any more duties. Instead, it will now be the directors who will safeguard the interests of the company and supervise the business and delegate daily operations to the officers.
Follow these guidelines to correctly specify directors for your company:
- Name at least one director — who must be a person, not another company — before shares are issued.
- The number of directors should at least match the number of shareholders. For example, if you have two shareholders, there must be at least two directors. This number must be dictated by the bylaws or the articles of incorporation.
- It is possible to include other limitations in either the bylaws or the articles of incorporation in reference to the service of a director.
Creating a Corporate Records Book
We recommend that you create and uphold bylaws for your corporation, even though Utah does not require them. Record-keeping through meeting minutes, on the other hand, is a requirement for maintaining a company's corporate status. Both tools will help protect your company, and we recommend analyzing Utah requirements before you incorporate.
Your records book may also aid in complying with Utah's annual reporting requirements. You will need to file an annual report each year by the date of your company's anniversary.
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