Are online incorporation and contract forms sufficient?


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Myself and two others have founded a start up and would like to incorporate. There are several sites that set up and file online (LegalZoom being one example), and I was wondering if in early stages the documents produced by these sites are sufficient.

As we grow we will likely be adding new members or pulling in more help. Will we need a lawyer at this point or if we keep things simple will the online forms work for this as well.

Contract Incorporation Online Lawyer

asked May 15 '12 at 03:26
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Zugwalt
135 points
  • Aaron, email Steve Kaplan (if you don't have his contacts, ping me for intro). =) – Dnbrv 6 years ago
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2 Answers


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My experience with those things is that most companies don't get into trouble filing their articles/certificate of incorporation. That's usually pretty easy and many Secretaries of State publish their own free forms for doing so. (But, see caveat, below). Where do-it-yourselfers usually get into trouble is AFTER forming the corporation -- doing things like issuing the shares and getting the company set up appropriately, adopting appropriate bylaws, appointing officers, and so on.

The caveat: there can sometimes be gotchas to incorporating by yourself. I've had people come to me who have used forms provided by one of those sites to form a Delaware corporation, and then received a huge franchise tax bill because the form used "no-par" shares, which have a different franchise tax treatment than shares with par values.

answered May 15 '12 at 03:43
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Chris Fulmer
2,849 points

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In addition to franchise tax issues (in California there is a minimum franchise tax of $800 even if you have zero profit), pay attention to renewal fees and deadlines as well as tax deadlines for the franchise tax board (which is separate from state and federal corporate income tax!) - penalties for missing a deadline can be significant. These aren't necessarily indicated on the forms you use! Which jurisdiction are you doing business in?

answered May 15 '12 at 03:51
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Henry The Hengineer
4,316 points
  • Thanks for the heads up! Its an online game with global user base but we are based in Washington, DC. – Zugwalt 6 years ago
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Contract Incorporation Online Lawyer