Start a Maine Corporation

Forming a Maine corporation is done through the Bureau of Corporations, Elections, and Commissions (BCEC). This entity is a branch of the Maine Department of the Secretary of State. While Maine doesn’t currently provide a fully digital platform for the creation of corporations, the Interactive Corporate Services option on the BCEC website can help with recurrent filings, such as annual reports.

This guide will take you through each detail of the incorporation process for creating a for-profit corporation in Maine.

How do I form a corporation in Maine?

To form a corporation, Maine requires you to take certain steps. You’ll need to file the Articles of Incorporation with the Maine Secretary of State. However, before you take this important step, you’ll need to complete a few things first.

To simplify the process of forming a corporation in Maine, we’ve put together 10 easy steps to form your business:

Step 1: Name your Maine corporation

Choosing a name for your Maine corporation is one of the earliest chances to set the tone for your company. Think of names that are punchy but professional, relate to your specific goods or services, and don’t come too close to the names of other businesses in the state.

Conduct a business name search to see if any of the names you like have been taken. Maine forbids any new corporation from giving itself a name too close to be distinguished from the name of another established business in the state.

Guidelines for Naming a Corporation in Maine

Some terms are prohibited from use in the title of your corporation without specific permissions and verifications from the Maine Secretary of State. Examples of these words include “Bank,” “Trust,” and “Credit Union.” Review Maine regulations on prohibited words before committing to your corporation’s name.

Other words must be included in the registered names of all Maine corporations. Those include “Limited,” “Incorporated,” and “Corporation” or the standard abbreviations of any of those three. You cannot register a corporation in Maine without including one of these three designators in your company’s title.

Reserving a Business Name with the Maine Secretary of State

Once you’ve settled on a name for your Maine corporation, it’s a good idea (though not legally required) to reserve your business name with the Secretary of State. This protects your chosen name from being claimed by another business for up to 120 days. The application and $20 filing fee for this service can be sent to:

Corporate Examining Section, Secretary of State
101 State House Station
Augusta, ME 04333-0101

It’s also wise to check whether your desired name is trademarked. To check at the federal level, visit the United States Patent and Trademark Office (USPTO) website. You can also register your trademark if you choose to do so. Trademarks also exist at the state level, so check with the BCEC to see if your desired name is already trademarked or to claim a state trademark of your own.

Consider any assumed names

Lastly, if you plan to conduct business under a name other than the one you registered as in your Articles of Incorporation, you will need to register an “assumed name.” This is also commonly known as a “doing business as” (DBA) name. 

However, Maine law makes a hefty distinction between an assumed name and a “fictitious name,” and there’s a significant difference in filing price. In most states, the terms are synonymous, but Maine uses “fictitious name” to refer specifically to a name that’s being adopted by a foreign (out-of-state) corporation because its original name is unavailable in Maine.

You can file your Statement of Intention to Do Business Under an Assumed or Fictitious Name for $125 for an assumed name and $40 for a fictitious name.

Step 2: Appoint directors

The state requires your Maine corporation to appoint a board of directors in charge of looking out for your company’s best interests. However, the law allows for the board of directors to vote to do away with the board and be managed by the shareholders. Maine legislature specifies that no corporation in Maine can install a board containing less than three directors. 

The law doesn’t require your corporation’s directors to be residents of Maine or shareholders in the company. Maine also lays out numerous guidelines for how directors are expected to handle their responsibilities.

Once you’ve selected your directors, you need to designate which one will function as your “incorporator” by signing the Articles of Incorporation. This incorporator might be yourself, a director from your board, or a shareholder.

Step 3: Choose a Maine registered agent

A registered agent functions as the official point of contact between your corporation and the state government. Registered agents might be single individuals or other professional entities. These individuals or entities receive important legal correspondence between your corporation and Maine.

In the case of domestic business corporations, the Maine BCEC office refers to these entities as “clerks,” either a “commercial clerk” or “noncommercial clerk.” “Registered agents,” for Maine’s purposes and paperwork, only apply to foreign business corporations and require different applications (commercial and noncommercial) for appointment. All clerks for Maine corporations must be residents of Maine or entities authorized to do business in Maine as commercial clerks.

When formally declaring your company’s intended clerk, Maine also distinguishes between a commercial and non-commercial entity. The difference here is that commercial clerks have commercial registered agent (CRA) licenses listed with the Maine Secretary of State. 

Noncommercial clerks and the companies that utilize them are not penalized and may choose to register as “commercial” later if they wish. The $35 fee applies to the filing of both commercial and noncommercial clerk appointments. 

All clerks and registered agents must be of legal adult age (18) and provide a valid street address in Maine where they can be found during normal business hours. P.O. boxes are prohibited as formal addresses for Maine commercial or noncommercial clerks.

The decision about designating a clerk is a weighty one. While you may initially be tempted to perform this function, this is not typically advisable. Here are a few of the advantages of hiring an outside agency to handle your company’s needs:

• Information security: The names of registered agents and clerks are a matter of public record in Maine. Using an agency means private information about you stays private.
• Legal barrier: Nothing could be worse than receiving a subpoena or court summons in front of a client. This can happen if you choose to stand in as your own registered agent or clerk. Hiring a professional or agency to represent your company in this way means all sensitive legal matters about your Maine corporation are handled behind closed doors.
• Freedom to focus on business: Having to remain at the stated address of your registered agent or clerk during business hours can take valuable time away from your business that could be better spent trying to grow it.

Step 4: File the Maine Articles of Incorporation

Now, it is time to file your Articles of Incorporation, the document that legitimizes your business in the eyes of the Maine government. The Articles of Incorporation must be filed before your company can conduct business in Maine.

To complete your application, you will need the following information about your company on hand:

• The corporation’s official name
• Whether the corporation status will be a benefit corporation or professional corporation (if not, leave these boxes unchecked)
• The name and street address of the corporation’s commercial or noncommercial clerk; if using a commercial clerk, include the Commercial Registered Agent (CRA) number 
• Number and type of shares
• Whether the corporation will have a board of directors or be managed by shareholders 
• Whether the corporation will have preemptive rights, meaning that current shareholders will be given first opportunity to buy unissued shares
• Any additional provisions you want to include in your Articles of Incorporation
• Name and address of the incorporators

Maine Articles of Incorporation must be accompanied by a $145 filing fee and mailed to:

Secretary of State
Division of Corporations, UCC, and Commissions
101 State House Station
Augusta, ME 04333-0101

Email inquiries may be submitted to CEC.Corporations@Maine.gov.

Step 5: Create corporate bylaws

While corporate bylaws are listed as “optional” on your Maine Articles of Incorporation, they are an essential aspect of a successful corporation. Bylaws are intended to explain the established rules and expectations of your company. Everything from managerial structure to operating procedures should be included in your corporate bylaws, and they should be kept with your corporate records.

Corporate bylaws are where you can get specific about any aspect of your corporation’s internal workings. A few basic items that should be included in the bylaws include:

• Shareholder voting rules
• Procedures for keeping corporate records
• Director responsibilities
• Number and type of shareholder meetings 
• Stock structure

Step 6: Draft a shareholder agreement

Another step in the creation of your Maine corporation is the drafting of a shareholder agreement. This document represents a written contract between the shareholders of your company and the corporation itself. Unlike some of the preceding legal documents associated with the formation of your company, your shareholder agreement is private and only ever viewed by shareholders. 

You can use your company bylaws as a guideline when constructing your shareholder agreement to ensure that expectations on both sides are met. Your shareholder agreement is where you can lay out specifics about stock share processes. It also outlines the rights and responsibilities of the shareholders.

It is important that every shareholder in your Maine corporation reads and signs the shareholder agreement to show their formal agreement with its contents.

Step 7: Issue shares of stock

The word “corporation” implies a group of people with shared responsibility. For your Maine corporation to be legitimate, it is mandated to issue shares of stock. Becoming familiar with Maine’s laws surrounding corporate stock issuance can help you understand this process fully.

Your Maine Articles of Incorporation will ask you to identify a specific number of shares that you plan to make available. Keep some stock in reserve at your initial issuance.

Determining how many shares to issue to given shareholders depends on the ownership structure set up in your bylaws and shareholder agreement. Let’s say you began with just three shareholders, and each owns one-third of the stock in your Maine corporation. If you declare in your Maine Articles of Incorporation that 1,000 authorized shares will be available, you would perhaps offer 100 shares to each shareholder and keep 700 shares in reserve.

You choose whether shares of stock in your Maine corporation are sold privately among shareholders and directors or on the public stock market. If you decide to take your company’s stock public, you will be required to submit quarterly reports detailing your stock information to the federal government. Form 10-Q can be found on the U.S. Securities and Exchange Commission (SEC) website.

Step 8: Apply for necessary business licenses and permits

The business licenses and/or permits your Maine corporation may require will vary according to several factors. Maine does not mandate a general business license. Once you have incorporated with the BCEC, you should find out what is required of your business at the county and city levels. Locate your local municipal website as a starting point.

Depending on your industry, specialized business licenses and permits may be in order at the local, state, and federal levels. Professional licensure for many service-based fields like psychology, accounting, or teaching comes with their own requirements.

All corporations must register with the State of Maine Bureau of Corporations.

You can visit the Small Business Resources webpage of the BCEC to learn more about licenses and permits that may pertain to doing business in Maine.

Step 9: File for an EIN and review tax requirements

Your Maine corporation will need to register with the IRS and receive an employer identification number (EIN), also known as a federal tax identification number. The EIN for your company operates as a federal identifier and allows you to open a business bank account, hire employees, and pay federal taxes. You will also need your employer identification number when securing any financing that may go into the creation of your Maine corporation.

An employer identification number can be obtained quickly and easily by completing an application on the IRS website. There is no charge associated with getting an EIN, and you should receive your unique number after applying.

You will need to review the basics of Maine corporate taxes to gain a better understanding of your company’s state tax requirements. Business taxes surrounding common corporate needs like sales and use can be addressed online through the Maine Revenue Services website.

Opening a business bank account is not only vital for keeping personal and business finances separate at tax time, but can also help protect the business owners from personal liability by further establishing the corporation as a separate entity from its owners.

Step 10: Submit your corporation’s first report

One of the steps in forming your Maine corporation that will become a mainstay of your business requirements is filing your annual report. Your annual report consists primarily of your business’s name, purpose, owners, and other pertinent details that can be added in the “attached pages” section at your discretion. 

Filing the annual report for your Maine corporation is a legal requirement that keeps your business in good standing with the state government. You can create a printable paper form with just the entry of your corporation’s charter number or take part in the online filing option.

The legal filing deadline is June 1 each year, and your first report will be due at the first deadline occurring after your official formation. For example, if you incorporate it on July 15, 2020, your annual report will be due on June 1, 2021.

The filing fee for submitting an annual report in Maine is $85, which can be paid by check or money order if sent by mail or by credit card if paid online. A $50 late fee is imposed for annual reports submitted past the established deadline.