Step 1) Verify & Secure Brand Name
To secure and register your brand name it must be unique, not too similar to another registered name in South Dakota, and shouldn’t contain any restricted wording. To check, conduct a free Business Entity Search through the state, 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 name must contain words like “Corporation”, “Incorporated”, “Company”, or “Limited,”. Abbreviations like “Corp.”, “Inc.,” “Co.” or “Ltd.” are also acceptable. If needed, you can file an Application for Reservation of Name form that’s good for 120 days.
Filing Fee: $25
Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your business. Use WEEBLY to search your options. If there’s a quality domain name for purchase, we advise buying it right away. Even if launching a business website isn’t on your radar right now, it’s going to be soon, and you might as well nail down a domain name that’ll make it easy for customers to find you!
Step 2) Appoint A Registered Agent
Your South Dakota Registered Agent is a sort of legal representative of your brand, but not in a lawyer or attorney-sense. It’s their job to officially receive/process important business documents like state filings, legal notices, tax forms, and so forth. This is why they have to be either a SD resident individual or a registered business entity and be reliable during all regular business days/hours.
That said, you can hire 3rd party professional and expect to pay up to $160/year, or get a registered agent free of charge when you incorporate with IncFile or Incorporate.com. They handle this along with so much more depending on your startup package.
Step 3) File Articles Of Incorporation
For your corporation to be legally formed, you need to file Articles of Incorporation with the Sec. of State. It declares the basics of your brand for the public record including:
- Corporate name, address, purpose,
- Name and address of registered agent,
- Number of shares the corporation is permitted to issue,
- Name and address of every incorporator,
- Name and address of every member of the Board of Directors, and so on.
Filing Fee: $150
Step 4) Get A Corporate Records Book
Think of this as the hard copy record book where all critical corporate documents are kept like the Articles of Incorporation, Bylaws, meeting minutes, stock certificate ledger, stock certificates, stock certificate stubs, stock transfer documents, etc. It’s the ultimate company binder! They’re very common and while not necessary having one is highly recommended for all serious business entities.
Step 5) Elect Director, Meet, Discuss Bylaws
Appoint at least 1 director who among other things will oversee the South Dakota 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 should:
Step 6) Setup A Corporate Bank Account
Ideally, during your first shareholder meeting you spent time going over where to set up your corporation’s financial foundation. With so many institutions (local, state, national) with tons of different fee structures, incentives, kickbacks, and other business services this shouldn’t be taken lightly.
The other issue is to ensure corporate accounts aren’t mixed with accounts of any other kinds. It should be a separate account for easy financial tracking and tax purposes synced with your accounting software. Here’s a quick breakdown article on Business Checking Accounts from some of the biggest banks to begin your research.
Step 7) Handle Taxation & Licensing/Permits
As a legally operating corporation, you’re required to be 100% compliant with all relevant local/state/federal agencies. Ideally you should have an attorney or at least be working with a professional filing service. Otherwise, here are four resources to get started:
- Get a free EIN, or Employer Identification Number, quickly through the IRS Website.
- Bookmark the Sioux Falls Small Business Admin and the state’s Business Tax Division.
- To form an S-Corp, submit Form 2553 with the IRS and be sure all board of directors have signed it.
- Also, consider professional Business License Research packages that take care of the legwork for you.