What are Articles of Incorporation?
Articles of Incorporation are documents filed with a state government to legally form a corporation. Once approved, your corporation exists as a separate legal entity from its owners.
LawDepot's Articles of Incorporation template works for both S corporations and C corporations.
Articles of Incorporation are also known as:
- Certificate of incorporation
- Corporate charter
- Business incorporation papers
- Company constitution
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Before you file your Articles of Incorporation, use LawDepot’s Business Formation template to help ensure a legally protected, government-compliant foundation for your corporation.
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Articles of Incorporation vs. Articles of Organization
Articles of Incorporation form a corporation. LLC Articles of Organization form a Limited Liability Company (LLC). Both are filed with the Secretary of State, but they serve different entity types.
The originating documents of a corporation are its Articles of Incorporation, while the equivalent documents for LLCs are called Articles of Incorporation. LLCs typically pair their Articles of Organization with an LLC Operating Agreement.
Articles of Incorporation vs. Corporate Bylaws
Articles of Incorporation are filed with the state and the key information about the corporation they contain is searchable by the public. By contrast, Corporate Bylaws are private, internal documents that govern how the corporation runs day to day, including meetings, voting, and officer duties.
Corporations typically adopt their Corporate Bylaws at their organizational meeting shortly after incorporating. The bylaws would later by approved, or sometimes amended, by the shareholders at their first general meeting.
Why incorporate?
You need Articles of Incorporation to legally form a corporation. Beyond that requirement, incorporating gives you:
- Limited Liability: Owners aren't personally responsible for the corporation's debts. They only stand to lose what they invest in the corporation.
- Tax management: Corporations benefit from tax rates which are lower than the top personal income tax rate and can choose to reinvest profits rather than declare dividends.
- Investment: Issuing shares in various classes makes it easy to raise capital without sharing control
- Credibility: A registered corporation often carries more weight in the marketplace and with investors.
- Defined structure: Clear roles for directors, officers, and shareholders.
Keep in mind that corporations come with trade-offs. Compared to sole proprietorships and partnerships, corporations involve higher setup and maintenance costs, a greater administrative burden, and ongoing corporate compliance obligations such as annual filings, recordkeeping, and meeting requirements.
For more on choosing a business structure, see the U.S. Small Business Administration's guide.
Types of corporations
In the United States, C corporations and S corporations are the two most common types. Here’s how they differ from each other:
C corporation
A C corporation is the traditional model and the most common business structure for major companies. It's a legal entity separate from its shareholders, so it can buy property, take out loans, and be sued in its own name. Shareholders aren't personally liable for the corporation's debts — they can only lose what they invested if the corporation goes out of business.
C corporations pay corporate tax on their profits. Shareholders then pay personal income tax on dividends they receive from the corporation and directors and named officers pay personal income on any salaries they receive for services rendered to the corporation. This is often called "double taxation."
S corporation
S corporations exist to solve the double taxation problem for smaller companies. They're "pass-through entities," meaning profits pass directly to shareholders and are taxed only as personal income, similarly to taxation of partnerships.
S corporations are limited to 100 shareholders, none of the shareholders can be corporations or partnerships, and can only have one class of stock. C corporations which are eligible may elect for S corporation status by filing Form 2553 with the IRS.
What should be included in your Articles of Incorporation
Your articles should include:
- The corporation's name, location, and purpose
- The number of shares, and share classes, the corporation is authorized to issue
- The registered agent's name and registered office address
- Each incorporator's name and address
- The names of each initial director
- Any starting provisions governing the corporation's management
Filing requirements vary by state. LawDepot's templates customize your document to comply with your state's rules.
How to create Articles of Incorporation
LawDepot's questionnaire walks you through each step. Here's what you'll cover.
Step 1: Choose your state and corporate purpose
Start by selecting the state where you'll file. Each state has different requirements corporations need in their document, and LawDepot customizes your template to be state-compliant.
You can also describe your corporation's purpose. If you don't want to limit your activities, your document will say the corporation is formed "for purposes of engaging in any lawful business."
Step 2: Name your corporation and set its duration
Choose a name that meets your state's rules. Corporate names need to include a legal suffix such as "corporation," "incorporated," or "limited" (or an abbreviation) which confirms the status of the business as a corporation.
In addition, corporate names must be unique and not too similar to those of any pre-existing business. Confirm the name you want is available through your state's business entity search before filing.
Then decide how long the corporation will exist:
- Indefinitely
- For a set number of years
- Until a specific date
- Unspecified
Step 3: List incorporators and initial directors
Incorporators: Create and organize the corporation. They can be individuals or business entities, and one of them files the articles with the state. Once the company has been set up, the role of the incorporators is at an end. However, incorporators are typically issued shares at the corporation’s organizational meeting and become shareholders.
Initial directors: appointed either in the articles or at the organizational meeting. This initial appointment is later confirmed by the shareholders at their first meeting. Directors make most of the day-to-day decisions. Listing the initial appointees in your articles isn't always required, but it can save time later. For more on the difference between these roles, see our guide on shareholders versus directors in a corporation.
For each incorporator and director, include their full name and address.
Step 4: Set authorized shares and share classes
Decide how many shares the corporation can issue in total. This is the authorized share count — you don't have to issue them all at once. Authorizing more shares than you plan to issue gives you flexibility for future fundraising, but some states tie filing fees to the authorized share count.
Most corporations use a single class of common voting shares. You can create up to two additional preference share classes in LawDepot's template to separate voting rights, dividends, or redemption terms.
The purpose of preferential share classes is to attract investors by providing a lower risk investment option which leaves the decision-making power in the hands of the common shareholders. For each preferential class, you'll set:
