Form a Alabama Corporation
Learn more about incorporating in Alabama. We will assist you with forming your Alabama corporation, the right way. To get started, simply click on “Order Now.” Please feel free to call us, anytime, with any questions.
Incorporating in Alabama
Incorporating in Alabama can be vital to businesses based of Alabama. At LawInc, we prepare your Alabama corporation Certificate of Incorporation, bylaws, stock certificates, stock ledger and more. We can even obtain your Alabama corporation Tax ID number and file your S corporation election with the IRS.
Alabama Incorporation Information
The following Alabama incorporation information will likely be helpful when deciding to incorporate in Alabama.
Alabama Corporation Name
The first step in forming an Alabama corporation is selecting the business name. Alabama corporation names:
- Must end with “Corporation,” “Corp.,” “Incorporated,” “Corp.,” or “Inc.”
- Cannot contain language indicating or implying that it’s organized for anything other than a legal business purpose.
- Cannot contain a word or phrase that indicates or implies that it is organized for non-legal business purpose.
- Must be unique from any other registered Alabama corporation or other business entity and any names reserved on record.
Alabama Corporation Formation
Alabama Corporation Filing Procedure: (1) Submit to Probate Judge 1 executed original and 3 conformed copies of the Certificate of Formation along with a Certificate of Name Reservation as issued by the Secretary of State to the Probate Judge of the County of corporation’s registered office. Submit fees for Probate and Secretary of State to Probate’s Office (separate checks). The Judge of Probate’s Office will transmit the fees along with two 2 certified copies of the Certificate to the Office of the Secretary of State within 10 days after the Certificate is issued. The Alabama Secretary of State will send the filer a copy once the Certificate is filed at the state level. (2) Submit Initial Business Privilege Tax Return to the Department of Revenue within 2 ½ months of incorporation. Original signatures are required on documents.
Alabama Corporation Fees: Alabama Corporation filing fee is $40 + $100 for 24 hour expedite. Required name reservation is $25 + $10 for 24 hour expedite. Probate judge fee is $35 – $60, depending on the County.
Alabama Corporation Purpose Clause: It is acceptable to state with a specific purpose clause, “The purposes for which the corporation is organized shall be to transact any and all lawful business for which corporations may be incorporated pursuant to the provisions of the Alabama Business Corporation Act.”
Alabama Corporation Authorized Shares and Minimum Paid in Capital: There is no minimum or maximum number of authorized shares since state incorporation fees are not based on the share structure. If the corporation authorized no-par shares, a Sworn Statement as to the value of the shares must be filed. There is no minimum amount of paid in capital required to commence business.
Alabama Corporation Directors: The number of directors shall be one or more, as specified in or fixed in accordance with the certificate of formation or bylaws.
Alabama Corporation Limitation of Director’s Personal Liability: The certificate of formation may contain a provision eliminating or limiting the liability of an Alabama corporation’s directors or shareholders for money damages for any action taken, or any failure to take any action, as a director, except liability for (A) the amount of a financial benefit received by a director to which he or she is not entitled; (B) an intentional infliction of harm on the corporation or the shareholders; (C) unlawful distributions; (D) an intentional violation of criminal law; or (E) a breach of the director’s duty of loyalty to the corporation or its shareholders.
Alabama Corporation Incorporator: Minimum number of organizers is 1 (a person or entity) and there is no requirement that the organizer be an Alabama resident.
Alabama Corporation Registered agent: The corporation must maintain a registered agent and office to receive service of process in Alabama.
Alabama Corporation Post-Filing Requirements
Alabama Corporation Initial Business Privilege Tax Return: Within two and a half months of formation, the corporation must file a business privilege tax return. Failure to do so will invalidate the corporation.
Alabama Corporation Annual Report: All Alabama corporations are required to file an annual report, on March 15. An annual Alabama report should be filed together with the corporation’s franchise tax returns (The Alabama Business Privilege Tax Return). The Alabama Department of Revenue does not mail annual report of tax return reminders, but they will send a notice if the filing deadline is passed.
Both initial and ongoing Business Privilege Tax returns have a $100.00 minimum fee (which varies based on the company’s finances) . Corporations also have to pay an additional $10 fee to file the Annual Reports. A late fee of $100 plus interest applies to all late returns and reports.
Alabama Corporation Taxes
There are two Alabama business taxes: 1) the state income tax, and 2) the business privilege tax. The income tax rate is 6.5%. The minimum business privilege tax is $100. The business privilege tax rate is calculated using taxable income and net worth of the corporation. For more information on taxes, visit http://www.ador.state.al.us/bus.html.
Alabama recognizes federal S corporation tax status. The subchapter S election is automatic and no state specific forms are required be filed to make the election.
Federal Tax Identification Number/Employer Identification Number (EIN): The Federal Tax Identification Number, also known as the Employer Identification Number (EIN) is a number that is assigned to a business by the Internal Revenue Service. An EIN is like a Social Security Number for a business. It is a requisite for certain business functions such as opening bank accounts or hiring employees. All corporations should obtain an EIN.
Alabama Corporation Dissolution
When you cancel your Alabama corporation you must do so with the State of Alabama and the federal government.
Alabama Corporation Dissolution Requirements: To dissolve an Alabama corporation, you must provide the completed original and 2 copies of the Domestic For-Profit Corporation Articles of Dissolution form, to the Probate Judge in the County where the original Articles of Organization were filed. An original signature is required. The filing fee is $100 Secretary of State fee + $10 Probate fee (varies).
IRS Dissolution Requirements: Corporations are required to file IRS Form 966, Corporate Dissolution or Liquidation. A final tax return should be filed with the IRS. Form 966 should be filed along with the final tax return.