Benefits of a corporation
A corporation helps to protect its owners’ personal assets if the corporation is sued or has financial troubles or if a corporate employee or business partner is sued. A corporation may also offer benefits such as tax advantages and the ability to easily transfer shares among owners, which can make your company more attractive to investors.
Requirements for incorporating in West Virginia
Preparing your articles of incorporation
To form a corporation in West Virginia, you must file articles of incorporation with the Secretary of State and pay a filing fee. Your corporation will legally exist as soon as you file the articles. The articles of incorporation must contain the following:
- Name of the corporation
- Corporate purpose
- Stock structure
- Names and addresses of incorporators
- Registered agent and registered office
- Mailing address of the corporation’s principal office
- Email address where informational notices and reminders of annual filings may be sent
- Number of acres the corporation will have in West Virginia
In regard to stock structure, the articles of incorporation must state the total number of shares the corporation is authorized to issue and either the par value of those shares or that the shares have no par value. Par value is a minimum value assigned to a share. If there is more than one class of shares, the articles must list the classes of shares, the number of shares in each class and a distinguishing designation for each class. Before shares in any class are issued, the articles must describe the limitations, relative rights and preferences for that class of shares.
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Naming your corporation
The Secretary of State recommends confirming the availability of your proposed business name before filing articles of incorporation. You can do this by conducting a preliminary online search on the Secretary of State’s website and then calling the Secretary of State’s office to confirm that the name is available.
You can reserve a name for 120 days by filing an application with the Secretary of State.
Your corporation’s name must meet the following requirements:
- It must contain the word “corporation,” “incorporated,” “company” or “limited,” or the abbreviation “corp.,” “inc.,” “co.” or “ltd.”
- It must be distinguishable from any other entity names in the records of the West Virginia Secretary of State.
An incorporator signs the articles of incorporation and files them with the Secretary of State. The following requirements apply when specifying incorporators:
- Incorporators must provide their names and addresses in the articles of incorporation.
- Every corporation must have at least one incorporator.
- A corporation may be a person or an entity.
- If initial directors are not named in the articles of incorporation, the incorporators must elect directors. They may also adopt bylaws. After that, the incorporators have no further duties.
Directors are responsible for overseeing the corporation’s policies and management. Directors have a fiduciary duty to act in the best interests of the corporation.
The following requirements apply when specifying directors for your corporation:
- Every corporation must have a board of directors consisting of at least one director unless a shareholders’ agreement eliminates the board of directors.
- There is no other limit on the number of directors, but the articles of incorporation or bylaws can specify the number of directors.
- The articles of incorporation or bylaws may establish eligibility requirements for directors.
Specifying a registered agent and registered office
Every corporation must have a registered office and a registered agent in West Virginia. A registered agent receives official documents such as lawsuits and notices on behalf of the corporation. The registered office is the agent’s business address.
In regard to specifying a registered agent and registered office, you must adhere to the following requirements:
- The articles of incorporation must list the registered agent’s name and the registered office street address in West Virginia.
- The registered office may be the same as the corporation’s place of business.
- A registered agent may be an individual who resides in West Virginia or a corporation formed or authorized to do business in West Virginia. The registered agent’s business address must be identical to the registered office.
Stating a corporate purpose
You must briefly describe the general type of business your corporation will conduct. To provide your corporation with the maximum flexibility, the corporation’s purpose can end with the phrase “including the transaction of any or all lawful business for which corporations may be incorporated in West Virginia.”
Determining incorporation bylaws
Bylaws are the rules for the way a corporation will be run. They describe the powers, duties, and rights of the corporation’s directors, officers, and shareholders and may include any provisions for managing the business and regulating the affairs of the corporation. Bylaws are not filed with the Secretary of State but should be kept at the corporation’s principal place of business.
The following requirements apply when determining bylaws:
- Bylaws are required. Either the directors or the incorporators may adopt them.
- Bylaws cannot include anything that conflicts with the law or the articles of incorporation.
Costs of incorporating in West Virginia
The West Virginia Secretary of State requires a fee when filing articles of incorporation or reserving a corporation name. The incorporation fee is partially determined by the number of acres the company intends to hold in the state. Corporations are also required to pay state and federal income taxes.
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