Starting a Corporation in Wisconsin 2024: Expert Guide

One crucial aspect of starting a business is selecting the appropriate legal structure for your venture. Starting a corporation in Wisconsin is a popular choice for many entrepreneurs due to the state’s favorable business environment and legal framework. Incorporating your business can provide several benefits, including personal liability protection, tax advantages, and increased credibility with customers and investors.

However, like Wisconsin LLC, running a corporation also comes with significant responsibilities, including complying with state and federal laws, maintaining accurate records, and holding regular shareholder meetings. This guide will explore the benefits and responsibilities of starting Wisconsin corporation. At LLCBase, we understand that forming a corporation can be an overwhelming experience, so we are here to help you every step of the way and set your business up for success.

Start a Corporation

What is a Corporation

A corporation is a legal entity separate from its owners, created to conduct business. It is established under the laws of the country or state where it operates and is registered with the government. The corporation can enter into contracts, sue and be sued, own property, hire employees, and issue stock to the public. It is governed by a board of directors responsible for managing the corporation’s affairs and making decisions on its behalf.

One of the primary advantages of a corporation is limited liability, which means that the shareholders or owners are not personally liable for the debts and obligations of the corporation. This protects their personal assets from being used to pay off business debts. Other benefits include easier access to capital through the issuance of stock and the ability to transfer ownership more easily.

However, corporations often face more regulations and legal requirements than other business structures, such as sole proprietorships or partnerships. They are also subject to double taxation, as the corporation is taxed on its profits, and shareholders are taxed on the dividends received.

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Guide to Start Your Wisconsin Corporation

The following is a detailed guide outlining the steps to establish a corporation in Wisconsin:

Step 1: Choose a Corporate Name

Choosing a business name for your Wisconsin corporation is critical in forming one. It must be unique and distinguishable from other existing Wisconsin corporations, limited liability companies, and limited partnerships. To check the availability of your desired name for your Wisconsin corporation, search the Wisconsin Department of Financial Institutions database. If the name is available, you can reserve it for up to 120 days by filing a Name Reservation Request Form and paying the required fee. This ensures that your chosen name is secured while you work on other steps to form a corporation in Wisconsin.

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Step 2: File Articles of Incorporation

To officially form a corporation in Wisconsin, you must draft and file Articles of Incorporation with the Wisconsin Secretary of State. This document includes essential information, such as the corporation’s name, purpose, Registered Agent, and the number of authorized shares. Providing accurate and complete information in your Articles of Incorporation is crucial for successfully forming your Wisconsin corporation.

Once completed, submit the articles and the filing fee to the Wisconsin Secretary of State‘s office. You can file online, by mail, or in person, whichever method is most convenient for you. Filing the Articles of Incorporation with the Wisconsin Secretary of State is vital in forming your Wisconsin corporation and establishing its legal existence.

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Step 3: Appoint Registered Agent

A Registered Agent is crucial in maintaining your Wisconsin corporation’s compliance with state requirements. The Registered Agent acts as the corporation’s official point of contact with the state, receiving legal documents and correspondence on behalf of the corporation. Every Wisconsin corporation must have a Registered Agent with a physical address to ensure seamless communication with the state government.

You can appoint an individual or a Registered Agent service in Wisconsin for your corporation. When choosing a Registered Agent, ensure they are reliable and consistently available during business hours to receive and forward important documents to your corporation. Appointing a trustworthy Registered Agent is essential to successfully form and maintain a corporation in Wisconsin.

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Step 4: Create Corporate Bylaws

Creating corporate bylaws is vital in establishing a well-organized and legally compliant business structure when forming Wisconsin corporation. Corporate bylaws serve as a set of internal rules and procedures that govern the corporation’s management and operation, ensuring consistency and clarity in business operations.

Bylaws typically include information about the Wisconsin corporation’s management structure, the rights and responsibilities of shareholders, directors, and officers, and provisions for annual meetings and decision-making processes. By outlining these essential components, corporate bylaws provide a clear and organized framework for running a successful Wisconsin corporation.

Drafting and adopting bylaws should be a collaborative process involving the corporation’s initial board of directors. By holding an initial board meeting, directors can discuss, refine, and adopt bylaws that best suit the corporation’s needs and objectives.

Step 5: Issue Stock

Issuing stock is a fundamental aspect of starting Wisconsin corporation, as it allows initial shareholders to invest in the company in exchange for capital contributions. The number of authorized shares is specified in the Articles of Incorporation, and the board of directors determines the value of each share.

When issuing stock for your Wisconsin corporation, it’s essential to provide stock certificates to shareholders as a record of their ownership. Additionally, maintaining accurate and up-to-date stock ownership records is crucial for legal compliance and ensuring transparency in the corporation’s financial structure.

Step 6: Obtain an EIN

An Employer Identification Number (EIN) is a unique tax identification number assigned by the Internal Revenue Service (IRS) to your Wisconsin corporation. Obtaining an EIN in Wisconsin is essential for tax reporting, banking, and hiring employees, as it serves as the corporation’s identifier in these contexts.

Applying for an EIN is a straightforward process that can be completed online through the IRS website or by mail using Form SS-4. This important step in forming Wisconsin corporation ensures your business can operate legally and fulfill its tax obligations.

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Step 7: Open a Corporate Bank Account

Opening a separate bank account for your Wisconsin corporation is crucial to separating personal and business finances. This separation helps protect the corporation’s limited liability status and ensures accurate financial record-keeping for tax and legal purposes.

You will need your Wisconsin corporation’s EIN, Articles of Incorporation, and corporate bylaws to open a corporate bank account. Some banks may also require a corporate resolution authorizing the opening of the account. By providing the necessary documentation and opening a dedicated bank account, you are taking an essential step in establishing and maintaining a successful Wisconsin corporation.

Opening a separate bank account for your corporation is essential to balance personal and business finances. You will need your EIN, Articles of Incorporation, and corporate bylaws to open a corporate bank account. Some banks may also require a corporate resolution authorizing the opening of the account.

Step 8: File a Statement of Information

Within the end of the quarter following the LLC’s tax closing month, you must file a Statement of Information with the Wisconsin Secretary of State. This document is a vital update for the state regarding the corporation’s officers, directors, Registered Agent, and business address, ensuring that the Wisconsin Secretary of State has accurate information about your corporation.

Filing an annual report in Wisconsin is crucial in maintaining your corporation’s good standing. The statement and the required filing fee can be filed online or by mail. Regularly updating this information with the Secretary of State is key to managing your Wisconsin corporation’s ongoing compliance requirements.

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After Forming a Corporation

Once you have successfully formed a corporation, there are several steps you must take next. Here’s a comprehensive list for your reference to ensure your newly formed corporation operates smoothly and within legal guidelines.

Obtain the Required Licenses and Permits

Depending on the nature of your Wisconsin corporation’s business, you may need to obtain various local, state, and federal licenses and permits. These requirements can vary significantly depending on your industry and location, making it essential to research the licenses and permits necessary for your corporation to operate legally.

Once you have identified the necessary licenses and permits, begin the application process before commencing business operations. Ensuring your Wisconsin corporation has all the required licenses and permits is crucial for legal compliance and avoiding potential penalties.

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Register for State Taxes

To form Wisconsin corporation, you must register your corporation with the Wisconsin Department of Tax and Fee Administration to pay state taxes. These may include employment taxes, use tax, and sales tax permits in Wisconsin, depending on the nature of your business.

Consult with a tax professional to ensure compliance with all state tax requirements and to understand the types of state taxes that apply to your Wisconsin corporation. Proper registration and payment of state taxes are essential for maintaining your corporation’s legal standing and avoiding potential penalties.

Maintain Corporate Records

Maintaining accurate corporate records is essential for legal compliance and to protect your Wisconsin corporation’s limited liability status. Diligent recordkeeping ensures transparency in your corporation’s operations and supports decision-making processes.

Key records to maintain include minutes of corporate meetings, stock issuances, financial statements, and other essential documents. Keeping these records safe and organized allows you to effectively manage your Wisconsin corporation and maintain its legal compliance.

Hold Annual Shareholders’ Meetings

One of the ongoing requirements for Wisconsin corporations is holding annual shareholders’ meetings. These meetings allow shareholders to elect directors, review financial statements, and address other corporate matters, ensuring the corporation’s stakeholders are informed and engaged in decision-making.

To maintain legal compliance, document the proceedings of annual shareholders’ meetings with detailed minutes and store them in your corporation’s records. Doing so demonstrates that your Wisconsin corporation is adhering to its legal obligations and protecting its limited liability.

Comply with Federal Tax Requirements

In addition to state tax obligations, your Wisconsin corporation must comply with federal tax requirements by filing a corporate income tax return (Form 1120) with the Internal Revenue Service (IRS). Timely and accurate filing of tax returns is essential for avoiding potential penalties and ensuring your corporation’s ongoing compliance with tax laws.

Given the complexity of tax regulations, consulting with a tax professional when preparing and filing your Wisconsin corporation’s tax returns is highly advisable. A tax professional can help you navigate the intricacies of tax laws, identify potential deductions and credits, and ensure your corporation meets all applicable tax requirements.

Seek Professional Advice

Forming and maintaining Wisconsin corporation is an ongoing process that requires attention to various legal and regulatory requirements. As laws and regulations change, staying informed about updates affecting your corporation and its operations is essential.

One way to stay informed and ensure ongoing compliance is by seeking professional advice from attorneys, accountants, or other experts specializing in Wisconsin corporation law. These professionals can provide invaluable guidance and assistance with forming and managing Wisconsin corporation, including maintaining proper documentation, meeting regulatory requirements, and addressing legal issues.

Fees for Starting Wisconsin Corporation

Here are some of the common fees associated when starting a corporation in Wisconsin:

Name Reservation Request Form fee: $15 (online) and $15 (mail)
Articles of Incorporation filing fee: $100
Annual report (Statement of Information) filing fee: $25

Please note that these fees are accurate as of 2022. Double-checking the Wisconsin Secretary of State‘s website for the most up-to-date fee information is always a good idea.

Importance of Incorporating a Corporation in Wisconsin

Wisconsin, also known as The Badger State, is one of the largest economies in the United States and offers a thriving business environment for entrepreneurs across various industries. Incorporating your business in Wisconsin provides a strong legal foundation that can help protect your personal assets, increase credibility with customers and partners, and offer potential tax advantages.

By forming Wisconsin corporation, you create a separate legal entity distinct from its owners, which can protect your personal assets from business liabilities. Additionally, Wisconsin corporations can benefit from the state’s extensive network of resources, including incubators, accelerators, and business-friendly initiatives that support growth and innovation.

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Benefits and Responsibilities of Wisconsin Corporation

Forming Wisconsin corporation comes with several benefits, such as:

Limited liability: As a separate legal entity, a corporation provides limited liability protection for its owners (shareholders), shielding their personal assets from business debts and liabilities.
Increased credibility: Incorporating a business can enhance its credibility with customers, suppliers, and investors, making it easier to establish business relationships and attract capital.
Tax advantages: Corporations may benefit from various tax advantages, such as lower tax rates on retained earnings, the ability to deduct employee benefits, and potential eligibility for tax credits and incentives.
Perpetual existence: Unlike sole proprietorships and partnerships, a corporation has a perpetual existence, meaning it can continue to operate even if its owners (shareholders) change.

However, with these benefits come certain responsibilities, including:

Compliance with state and federal regulations: Corporations must comply with various state and federal regulations, such as filing annual reports, maintaining corporate records, and holding annual shareholder meetings.
Tax obligations: Corporations have specific tax obligations, including filing corporate income tax returns and paying applicable taxes.
Maintaining corporate formalities: To preserve limited liability protection, corporations must maintain corporate formalities, such as adopting and following bylaws, issuing stock, and documenting corporate decisions.
Registration and ongoing fees: Incorporating a business in Wisconsin requires registration with the Wisconsin Secretary of State and payment of initial and ongoing fees, such as filing fees for the Articles of Incorporation and annual report fees.

Understanding the benefits and responsibilities of forming Wisconsin corporation is crucial for entrepreneurs seeking to establish a strong legal foundation for their businesses. By incorporating your business in Wisconsin and adhering to the associated responsibilities, you can enjoy the advantages of limited liability, increased credibility, and potential tax benefits while operating in the state’s dynamic and innovative business environment.

FAQs

What is a corporation in Wisconsin?

A corporation in Wisconsin is a legal entity created for business purposes that is separate from its owners and shareholders.

How do I start a corporation in Wisconsin?

To start a corporation in Wisconsin, you need to file Articles of Incorporation with the Wisconsin Department of Financial Institutions.

Does Wisconsin provide a template for Articles of Incorporation?

Yes, Wisconsin provides a template for Articles of Incorporation that you can use as a guide.

What information do I need to include in my Articles of Incorporation?

Your Articles of Incorporation should include your corporation’s name, registered agent and registered office, a statement of purpose, and the number and type of shares authorized.

How do I choose a name for my corporation in Wisconsin?

You can check if the name you want is available on the Wisconsin Department of Financial Institution’s website. Your name should also include one of the following

How do I register a registered agent and registered office for my corporation in Wisconsin?

You need to file a Statement of Registered Agent and Registered Office with the Department of Financial Institutions.

Can I be my own registered agent in Wisconsin?

Yes, you can be your own registered agent in Wisconsin if you have a physical address in the state.

How long does it take to get approval for my corporation in Wisconsin?

Approval times vary, but it usually takes a few business days to process.

How much does it cost to start a corporation in Wisconsin?

The filing fee for Articles of Incorporation in Wisconsin is $170.

Do I need to file any other forms after my Articles of Incorporation are approved?

Yes, you need to file an Initial Report form within 60 days of filing your Articles of Incorporation.

Do corporations in Wisconsin need to file annual reports?

Yes, corporations in Wisconsin need to file annual reports on the anniversary of its incorporation or foreign qualification.

What is the minimum number of directors a corporation in Wisconsin must have?

A Wisconsin corporation needs to have at least one director.

Can directors of a corporation in Wisconsin also be shareholders?

Yes, directors of a corporation in Wisconsin can also be shareholders.

What is a shareholder agreement?

A shareholder agreement is a legally binding agreement among the shareholders of a corporation that outlines their rights and responsibilities.

Does Wisconsin require me to have a shareholder agreement?

No, Wisconsin does not require corporations to have a shareholder agreement.

Do corporations in Wisconsin need to hold regular meetings?

Yes, corporations in Wisconsin should hold regular meetings of its shareholders.

Are there any taxes or fees I need to pay as a Wisconsin corporation?

Yes, corporations in Wisconsin need to pay income taxes and an annual report fee.

How do I apply for a tax ID number for my corporation in Wisconsin?

You can apply for a tax ID number for free online through the IRS website.

Do corporations in Wisconsin need to register for sales tax?

Yes, corporations in Wisconsin that sell taxable goods or services need to register for sales tax.

Can I operate my Wisconsin corporation from another state or country?

Yes, you can operate your Wisconsin corporation from another state or country, but you still need to register as a foreign corporation in Wisconsin.

How do I register as a foreign corporation in Wisconsin?

You need to file a Foreign Entity Registration form with the Wisconsin Department of Financial Institutions.

Do foreign corporations in Wisconsin have to have a registered agent?

Yes, foreign corporations in Wisconsin need to have a registered agent with a physical address in the state.

What happens if I don’t file annual reports?

If you don’t file your annual reports, your corporation will be considered delinquent, and you may have to pay penalties and interest.

Can I file my annual report online?

Yes, you can file your annual report online on the Wisconsin Department of Financial Institutions website.

How can I change the name of my corporation in Wisconsin?

You need to file an Amendment of Articles of Incorporation form with the Wisconsin Department of Financial Institutions to change your corporation’s name.

What is a DBA in Wisconsin?

A DBA in Wisconsin is a “doing business as” name, also known as a trade name.

How do I file a DBA in Wisconsin?

You can file for a DBA with your local county clerk.

Can I have more than one corporation in Wisconsin?

Yes, you can have multiple corporations in Wisconsin as long as they are separate legal entities.

Can I dissolve my corporation in Wisconsin?

Yes, you can dissolve your corporation by filing Articles of Dissolution with the Wisconsin Department of Financial Institutions.

What is the process of starting a corporation in Wisconsin?

The process of starting a corporation in Wisconsin involves registering your corporation with the Wisconsin Department of Financial Institutions.

What is the minimum number of directors that a corporation requires in Wisconsin?

In Wisconsin, a corporation must have at least one director.

How long does it take to start a corporation in Wisconsin?

The amount of time it takes to start a corporation in Wisconsin can vary, but it generally takes a few weeks.

Are there any organizational requirements for forming a corporation in Wisconsin?

Yes, when forming a corporation in Wisconsin, you must prepare and file articles of incorporation with the Department of Financial Institutions.

What is required to complete the articles of incorporation in Wisconsin?

The articles of incorporation in Wisconsin must include certain information such as the corporation’s name, its registered agent, and the number of shares authorized.

Where can I find the necessary forms to start a corporation in Wisconsin?

You can find the necessary forms to start a corporation in Wisconsin on the Wisconsin Department of Financial Institutions website.

What is the name availability requirement for starting a corporation in Wisconsin?

In Wisconsin, you must ensure that your corporation’s name is not being used by another business before completing the registration process.

How can I check if my corporation’s name is available in Wisconsin?

You can check if your corporation’s name is available in Wisconsin by using the online name search tool available on the Wisconsin Department of Financial Institutions website.

What is a registered agent and why is it required for starting a corporation in Wisconsin?

A registered agent is a person or entity that is designated to receive legal notifications and official correspondence on behalf of a corporation. It is required in Wisconsin because it ensures that a corporation can be reached in case of a legal dispute.

Can I be my corporation’s registered agent in Wisconsin?

Yes, you can be your corporation’s registered agent in Wisconsin if you are a resident of Wisconsin and have a physical address within the state.

Can a corporation have multiple registered agents in Wisconsin?

Yes, a corporation can have multiple registered agents in Wisconsin if they are all listed in the articles of incorporation.

What is the organizational meeting requirement for starting a corporation in Wisconsin?

The organizational meeting is a meeting that is held after the corporation is formed to elect directors, adopt bylaws, and take care of other organizational matters.

When should the organizational meeting be held for a corporation in Wisconsin?

The organizational meeting for a corporation in Wisconsin should be held as soon as possible after the corporation is formed.

What are bylaws and are they required for a corporation in Wisconsin?

Bylaws are rules and regulations that are established for an organization. They are required for a corporation in Wisconsin and are typically adopted during the organizational meeting.

What is the registered office requirement for a corporation in Wisconsin?

A corporation in Wisconsin must have a registered office, which is a physical location within the state where the corporation can be reached.

Is an annual report required for corporations in Wisconsin?

Yes, all corporations in Wisconsin are required to file an annual report each year.

What information is required on the annual report for a corporation in Wisconsin?

The annual report for a corporation in Wisconsin must include basic information such as the corporation’s name, address, registered agent, and the names of the directors.

When must the annual report be filed for corporations in Wisconsin?

The annual report for corporations in Wisconsin must be filed on or before the first day of the anniversary month of the corporation’s formation.

What are the rules and regulations around shares for a corporation in Wisconsin?

In Wisconsin, a corporation is required to have authorized shares, but the state does not specify the number of authorized shares a corporation must have.

How do I register my corporation for taxes in Wisconsin?

You can register your corporation for taxes in Wisconsin by contacting the Wisconsin Department of Revenue or filing online.

What taxes are corporations in Wisconsin required to pay?

Corporations in Wisconsin are generally required to pay corporate income tax, franchise tax, and sales tax.

Does a corporation in Wisconsin require business permits and licenses?

Depending on the type of business, a corporation in Wisconsin may require permits and licenses from other state and local agencies.

What is the corporation annual franchise tax credit in Wisconsin?

The corporation annual franchise tax credit is a tax credit that can be claimed by Wisconsin corporations for a portion of their franchise tax.

How do I dissolve my corporation in Wisconsin?

To dissolve a corporation in Wisconsin, you must file Articles of Dissolution with the Wisconsin Department of Financial Institutions.

What happens to the assets of a corporation when it is dissolved in Wisconsin?

Once a corporation is dissolved in Wisconsin, its assets are usually distributed to its shareholders. Any remaining assets are disposed of according to the corporation’s bylaws.

How to Save Money While Forming Your Wisconsin Corporation

One of the first ways to save money when forming a Wisconsin corporation is to do as much research and preparation as possible on your own. This includes familiarizing yourself with the process of incorporating a business in Wisconsin, as well as the necessary paperwork and requirements. By educating yourself on these aspects of starting a corporation, you can avoid costly mistakes that may require professional assistance to correct.

Another way to save money while forming your Wisconsin corporation is to take advantage of online resources and services. There are several online platforms that offer cost-effective solutions for incorporating a business, which can often be much cheaper than hiring a lawyer or other professional to assist with the process. These platforms typically provide step-by-step guidance and support to help you navigate through the incorporation process on your own.

Additionally, when it comes to choosing a registered agent for your Wisconsin corporation, it can be tempting to opt for the services of a professional company. While this can provide peace of mind and ensure compliance, it can also come at a steep price. Instead, consider appointing yourself or a trusted individual within your business as the registered agent to save on this expense.

When it comes to filing fees and incorporation costs, it is essential to shop around and compare prices. While the state of Wisconsin charges a filing fee for incorporating a business, there may be additional costs associated with obtaining necessary business permits and licenses. By researching different filing options and service providers, you can find the best deal that fits your budget.

Networking with other business owners and entrepreneurs can also be a valuable tool for saving money when forming your Wisconsin corporation. By leveraging the expertise and experiences of others who have gone through the process, you can gain insights and tips on how to cut costs and streamline the incorporation process.

Finally, when it comes to choosing legal and financial professionals to assist with forming your Wisconsin corporation, it is essential to be selective. You may be tempted to hire expensive lawyers or accountants, but there are often more affordable options available. Consider reaching out to local business development centers or small business associations that offer low-cost or free legal and financial advice for new business owners.

In conclusion, forming a Wisconsin corporation on a budget is entirely achievable with some careful planning and research. By taking advantage of online resources, shopping around for the best deals, appointing yourself as a registered agent, and networking with other business owners, you can save money while ensuring your new corporation is set up for success.

Conclusion

Forming a corporation in Wisconsin involves steps and ongoing compliance with state and federal requirements. By following these key steps and seeking professional guidance when necessary, you can successfully establish and maintain Wisconsin corporation, enjoying the benefits of limited liability protection, increased credibility, and potential tax advantages. Visit LLCBase to know more about starting a corporation in Wisconsin.