STEP 1) VERIFY & SECURE YOUR BRAND NAME

Choose a Business Name

The very first thing to do is ensure that the name you’d like isn’t already taken, doesn’t contain restricted words, or is too similar to another name under the eyes of state law. Before doing anything else, use the Alabama Business Entity Search system to check, and if there are potential trademark issues conduct another quick search using the TESS System through the U.S. Patent Office.

Keep in mind your brand name should contain the words ‘Corporation,’ ‘Company,’ ‘Incorporated,’ or ‘Limited.” Abbreviations for these words are also acceptable. If needed, you can file a Domestic Entity Name Reservation form.

Filing Fee: $10 fee with expedited options

STEP 2) ELECT A REGISTERED AGENT

Choose a Registered AgentEvery Alabama corporation, or business entity really, must elect a certified Registered Agent to represent their company. They’re responsible for receiving and helping to handle legal paperwork like all state filings & important business forms, legal notices, etc.

Basic requirements are that this agent be an Alabama resident/company with an Alabama street address. That said, you can hire an outside professional and expect to pay up to $160/year, or get a certified/qualified agent for free when you incorporate with IncFile or CorpNet.

STEP 3) FILE CERTIFICATE OF FORMATION

Register an LLCMost states have you file your corporation with the Secretary of State, but in Alabama you file a Certificate of Formation with the Judge Probate Court Office through mail in the county where your corporation’s going to do business. Make sure you attach a copy of the Business Name Reservation form when you file if you need to file one.

When your Certificate of Formation has been filed with the Probate Court, they’ll provide a stamped copy of your form and forward the original documents to the Secretary of State along with your $100 filing fee.

STEP 4) START A CORPORATE RECORDS BOOK

File Annual Reports & Publication RequirementsWhile not mandatory, this is very common practice among corporations because of the nature of the business entity. It’s in this book you should keep all critical pieces of red tape to ensure you’re well-organized, to protect your status legally, and come across professionally.

As the name of the book implies, it’s a record holder of your Alabama Corporation registration documents, business licenses and permits, minutes of meetings, and other important documents. We’re huge fans of Corporate Kits which include gorgeous records books/binders you can brand for as little as $99.

STEP 5) APPOINT DIRECTORS, MEET, AND DISCUSS BYLAWS

Hold a Meeting with Your Board of Directors

Appoint at least 3 directors who among other things will oversee the Alabama corporation until the first shareholder meeting where new directors will be voted in. Prepare an “Incorporator Statement” with complete names and addresses of each director and keep it in your records book. Once elected, an initial meeting will:

  • Appoint officers & discuss/create Corporate Bylaws.
  • Choose a bank & approve the issuance of stock certificates.
  • Agree on corporate seal and adopt official stock certificate form.
  • Approve S-corp Status (opt.). Record “Minutes of Meeting”, have directors sign, then add to records book.

STEP 6) OPEN A BUSINESS BANK ACCOUNT

Best Business Bank AccountIdeally, during your first shareholder meeting you spent some time going over where to bank and set up your corporation’s financial foundation. With so many different banks (local, state, national) with tons of different fee structures, incentives, kickbacks, and other business services this shouldn’t be taken lightly.

The other point is to make sure corporate accounts aren’t connected or mixed with any accounts of any other kinds. It should be a dedicated and separate account for easy financial tracking and tax purposes synced with your accounting software.

STEP 7) TACKLE TAXES & LICENSING/PERMITS

Business LicensesHow many employees will your corp have? Where’s it located and what kind of business are you in? Do you work with the public or hazardous materials? To ensure that you will not face penalties, fines, and fees when operating a business, you need to completely fulfill your business taxes and licenses obligations to the state. To get started, see the resources below:

Consider bookmarking the Birmingham district office of the Small Business Administration, and the Dept. of Revenue’s Business Licensing section because they’re going to be go-to sources. Also, consider investing in professional Business License Research packages can quickly get needed documents for you.

OPTIONAL) WRITE A BUSINESS PLAN

Write a Business PlanUnlike other types of businesses, corporations tend to need funding pretty earlier on which is why “funding-ready” plans are much more prevalent. What this means is that the basics are clearly refined and set down in a nice presentable plan ready to show investors, VCs, lending institutions, etc.

From marketing and budgeting, to competitive analysis and financial forecasts, these folks want to be able to quickly assess the core fundamentals of your brand to decide whether it’s a solid worthwhile investment or not. To learn more check out the links below.

  • Our free Business Plan Guide is designed to take you smoothly through the process step-by-step.
  • This Business Plan Software Guide is our savvy breakdown of all the best software solutions to help you plan better. (Spoiler: We’re huge fans of LivePlan, plus they offer our readers a special discount.)

OPTIONAL) BUILD A BUSINESS WEBSITE

Build a Business WebsiteNot every business needs to make digital marketing the cornerstone of their growth strategy, or even put much emphasis into building a digital presence. But a website is necessary nonetheless. What will potential customers and stakeholders find when they search for your brand online to see what it’s about and what people might be saying?

There’s a lot of options to get running smoothly if you don’t  have an in-house designer, for example Wix and Weebly. We have used and highly recommend both. Enjoy!

Need Help Forming Your Corporation?

Have a reliable incorporation service like IncFile or LegalZoom do the work for you. Just answer a few questions about your business and they’ll take care of the paperwork.

Although both offer virtually the same service, IncFile is $100 less and our top pick. Enjoy!

Visit IncFile Or Visit LegalZoom

Note that this article on how to form a corporation in Alabama isn’t a legal document or legal advice. It’s for informational purposes and the information above is subject to change. For specific legal questions regarding how to form a corporation in Alabama or business in general, please consult with a lawyer or other accredited professional.