articles of incorporation texas - Incorporation signifies that t

Incorporation is a registration as per the requirements of the company law in respective countries which is recognized legally as a separate existing entity in the eyes of law. Incorporation signifies that the business articles of incorporation texas enterprises is not sole proprietorship or partnership and is a separate legal existence or entity.

WHAT ARE THE LEGAL BENEFITS OF INCORPORATION

1. Protection of personal assets sole proprietors or partners are personally and jointly responsible for all business liabilities

A Corporation is a separate and distinct legal entity. This signifies that a corporation can open a bank account, own property and do business all under its own name. The main advantage of a corporation is that its owners, known as stockholders or shareholders, are not personally liable for the debts and liability of the corporation.

2. Transferable ownership

3. Retirement funds

4. Taxation benefits

5. Raising funds from sale of stock

6. Durability/life

7. Credit rating

STEPS INVOLVED IN INCORPORATION

1. Finding a name

2. Purpose or objects

3. Principal place of business

4. Number and type of shares

5. Registration fees to state

6. Corporate bylaw

INCORPORATE IN TEXAS

In the discussion carried above, we have understood the basis for going for incorporation.

The objective of this article is to under the procedures, formalities and benefits of incorporation in Texas. The Corporate Division under Secretary of State of Texas handles all business incorporations in Texas.

1. Select the Name of the Corporation

The first step articles of incorporation texas is selecting the name for the company. The name cannot infringe on a trademark or service mark.

The Name must contain the word Corporation,

Company, Incorporated or abbreviation. The name shall not be similar to existing corporation but with the approval of Secretary of State of Texas and with written consent from the existing corporation, an existing name can be used. The first and second choice of name of the corporation is to be finalized.

The legal concept of incorporation is recognized all over the world. In the United States, Corporations are identified by the term incorporated added after the business name such as XYZ Instruments, Incorporated or by putting the word corporation in the name of the company, as in Netscape Communications Corporation . In Germany, Austria and Switzerland, the GmbH (limited liability business association) as well as the AG (stock market traded business association) are the most common comparable concepts. In the United Kingdom, the titles Ltd (abbreviation for limited company) or plc (abbreviation for public limited company) are used for corporations. In France, Spain, Portugal, Poland, Romania and South America the title S.A. is used for corporations. Norway used AS for stock corporations and Sweden uses AB, Italy uses Srl (limited Liability Company) and SpA (stock Corporation). The Netherlands uses NV and Singapore uses Pte Ltd meaning private limited which is the equivalent of a U.S. incorporated entity. In India Ltd is used to denote public limited company and PVT Ltd is used to denote private limited company.

ARTICLES OF INCORPORATION IN TEXAS

The name of the corporation must include a corporate suffix such as Corporation, Corp., Incorporated, Inc., Company or Co... Even though a name is selected for a corporation and registered, it is not binding on the Secretary of State of Texas with regard to infringement with existing trade name or trade mark of any other corporation including foreign corporations also. Name can be kept reserved for a period of 120 days by submitting a request application to the Secretary of State of Texas after making the payment of fee.

The main business of the Corporation is to be mentioned. Location of the principle place of business is to be mentioned. Also location of the registered office of the corporation is to be mentioned.

Director Information

There is no provision under Texas Law for residential requirements of Directors. Particulars of Directors are required to be mentioned in the articles of incorporation texas. The details required to be mentioned are number of initial directors, their names and addresses.

Officers details are not required to be mentioned in the articles of incorporation.

All records and registers are required to be maintained in the Corporate Office.

Corporations must file a franchise tax return and annual statements. The franchise tax is calculated in Texas State at the rate of:

(a) 0.25% of net taxable capital and

(b) 4.50% of net taxable earned surplus. If the value works out to zero or negative or less than USD 100, then the tax is Nil.

The state of Texas does not recognize the S Corporation Status of Corporations.

If a corporation is operating certain business then it has to obtain license from the State of Texas, the Principal place of business and mailing address of the corporation.

Financial details like initial capital of the company are to be mentioned. Details of issue of shares of stock from the initial capital and subscribers to the same are to be mentioned. Details and rules and procedures for placing any restrictions on stock ownership or transfer of shares are to be mentioned clearly if the corporation decides to make such procedures.

The name and Texas address (P.O. Box not allowed) of the initial registered agent. Also the name, address and signature of the registered agent are to be effected here. Registered Agent is the person authorized to receive service of court papers etc, name and address of the Incorporator and his signature.

The following are the fee structure in Texas State:

Filing fee, USD 300

Other aspects in Texas are almost similar to requirements of other states like:

1. Holding of initial meeting of Directors to adopt bylaws, appoint officers and for

Issue of shares.

2. Obtain Tax number from Internal Revenue Service

3. Opening of bank account

4. Appointment of Auditors

From the above discussion, readers might get a natural doubt that the rules and procedures of articles on incorporation in Texas are similar to other states in USA. The inference arrived is right but not always. This is because each state is Unique in its offering of facilities provided and the following factors play a key role in selecting a state for articles of incorporation texas of Business:

1. Perception of presence of a business friendly environment

2. Generally favorable investment destination

3. Competitive income tax rates

4. Requirements towards sales tax

5. Licensing requirements

6. Annual return details

7. Workforce talent

8. Climate, weather

9. Infrastructure facilities like power, water

One of the recent trends in USA, China and India is greater movement towards federal structure whereby various states have different legal provisions. These states in turn are competing with each other to attract investments and new business incorporations in their respective regions so as to increase the employment levels and revenue earning sources. Special economic Zones, Export orient units, Export Processing Zones, Tax holiday islands all are output of such ideology. These regions have received huge investments in terms of billions of dollars in the last decade as inward investments. This investments and revenue have helped those regional governments to improve their infrastructure facilities at comparable levels that are exist anywhere in the world. Change Airport in Singapore, the new face of Beijing in China and changing face of business map in India are there for all of us to see and understand.

But the above recent development is not without flip side. There is uneven flow of capital investment among states in a particular country and fiscal discipline is thrown out of winds Because of political compulsions, States have started competing with each other on uneven scale and have made legal provisions which are not in conformity with central provisions or federal provisions. These issues are to be rightly addressed by economists. For example, if a Governor of Texas is lobbying to bring a overseas Corporation into Texas it is well within his moral duty to do so. But suppose the same person is elected to the Office of The President of the United States of America, if he lobbies to bring the same overseas Corporation into Texas ignoring rightful claims of other States in USA, there will be conflict of interest and dereliction in his duty.