Benefits of a corporation
A corporation limits personal liability for your business’s financial obligations and can help protect your personal assets if a company employee is sued. Forming a corporation can also have tax benefits and greater appeal for investors.
Requirements for incorporating in Maine
Preparing your articles of incorporation
A corporation’s existence begins when you file its articles of incorporation with the Secretary of State and pay a filing fee. The articles may contain many provisions, but they must contain the following:
- Name of the corporation
- Stock structure
- Registered agent
- Names and addresses of incorporators
A corporation can have different types of stock, called classes or series. These types of stocks can have different advantages, for example, one can offer voting rights while another may not.
Regarding the stock structure, the articles of incorporation must include the following information:
- The articles must identify the classes and series of shares and the number of shares in each class or series that the corporation is authorized to issue.
- If there is more than one class or series of shares, the articles must provide a distinguishing designation for each class or series. Before shares are issued in any class or series, the articles must state the rights, preferences, and limitations of that class or series.
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Naming your corporation
Your proposed corporate name must be available for use in Maine. You can check the availability of a name by searching the Secretary of State’s records online.
You can reserve a name for your corporation for 120 days by filing an application with the Secretary of State or through an online entity name reservation service.
Your Maine corporation name must be distinguishable from any other entity’s name, reserved name, or mark on file with the Secretary of State. Although Maine corporation names do not have to include a word such as “corporation,” “incorporated,” or “company,” if you include one of these words in your name, the people you do business with will know that your business is a corporation.
An incorporator delivers articles of incorporation to the Secretary of State for filing. Incorporators’ names and addresses must be listed in the articles of incorporation.
You must adhere to the following requirements when specifying incorporators:
- Your corporation must have at least one incorporator.
- An incorporator must be a person.
- If the articles of incorporation do not name initial directors, the incorporators must hold an organizational meeting to elect directors, at which time they may also approve bylaws and appoint officers. The incorporators have no further duties after the organizational meeting has concluded.
Corporate directors establish and implement the corporation’s policies and strategies. Directors are fiduciaries, so they must act in good faith and in the best interests of the corporation and its shareholders.
When specifying your corporation’s directors, you must adhere to the following guidelines:
- Your corporation must have at least one director. Although Maine does not limit the number of directors you may have, the articles of incorporation or bylaws may set the number of directors.
- The articles of incorporation or bylaws may establish eligibility requirements for directors.
Specifying a registered agent
A registered agent, also called a registered clerk, receives legal documents and other official correspondence on behalf of the corporation and is responsible for forwarding those documents to the corporation.
The following requirements apply when specifying your corporation’s registered agent:
- The articles of incorporation must list the name of your commercial registered agent and the job title of a person who will serve as your registered agent. A commercial registered agent is a corporation that acts as your registered agent.
- The articles must include the name and business address of your noncommercial registered agent. A noncommercial registered agent is an individual that acts as the agent.
- A registered agent may be an individual who resides in Maine or a business entity. An agent may also be a commercial registered agent that has registered with the Secretary of State.
Stating a corporate purpose
All Maine corporations have a purpose of engaging in any lawful business. You do not need to state any additional purpose in the articles of incorporation.
Determining incorporation bylaws
A corporation’s bylaws outline its internal rules and operating procedures. Although directors or incorporators must adopt bylaws, bylaws are not filed with the Secretary of State.
Although Maine law does not specify the content of bylaws, the document usually includes such items as the number of directors and their term of office and provisions for holding shareholders’ meetings and taking votes. Bylaws cannot include anything that is inconsistent with the law or the articles of incorporation.
Costs of incorporating in Maine
The Maine Secretary of State requires a fee when filing articles of incorporation or reserving a corporation name. Corporations are also required to pay state and federal income taxes.
When you are ready to start a corporation in Maine, LegalZoom can help you form a corporation online in three simple steps. LegalZoom also provides registered agent services in Maine.
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