All businesses should consider a formal entity structure, but there are some that would do better as a corporation than other types. See the ZenBusiness entity guide to see what’s right for you.
This article covers the most important steps needed in launching your enterprise and answers a few frequently asked questions. So, just what is a professional corporation (PC)? These are businesses owned by professionals who are certified by a state regulatory board. In layman’s terms, they include occupations such as physiotherapists, doctors, and veterinarians. Without further ado, here’s how to form an Alaska PC.
Steps to Form an Alaska PC
- Choose a name for your Alaska PC
- Select an Alaska registered agent
- Complete your Alaska Articles of Incorporation
- Establish a corporate record in Alaska
- Designate an Alaska PC board of directors
- Create Alaska corporate bylaws
- Hold your first board meeting
- Handle Alaska tax obligations
- Obtain Alaska business licenses and permits
- Acquire insurance for your Alaska PC
- Open a business bank account
Forming an Alaska Professional Corporation
Determine whether a PC structure is the right fit
First things first: You need to be a licensed professional before considering forming a professional corporation in Alaska. Licensed professionals include occupations such as doctors, veterinary services, accountants, and physiotherapists. Forming a corporation requires strict documentation, accurate record-keeping, and constant management. Sounds like this is the right fit? Then read further.
Step 1: Choose a name for your Alaska PC
Selecting a name that reflects both your brand and services. Your business name should also adhere to naming conventions laid out by Alaska’s commerce and business regulations.
Your official business name needs to include the word “Corporation,” “Company,” “Limited,” “Incorporated,” “A Professional Corporation,” or “P.C.,” and it cannot be vulgar. You also can’t include the words “city,” “village,” or “borough” because they’re restricted to government entities. The first step is to check with the state’s business database to see if the name is available. If it is, you can reserve it for 120 days through the state or using our name reservation service.
Because of the formalities involved in the naming restrictions, you might want to consider creating an Alaska DBA for your business (doing business as). DBAs prove effective for branding and marketing and also need to be registered. The final step in the naming process is to register a domain name for your website. We can help with that too.
Step 2: Select an Alaska registered agent
One of the many services on offer at ZenBusiness is to secure a registered agent with our valued partner. When forming a professional corporation, a registered agent is needed. The person can be someone in your business or a third-party. The registered agent is your point of contact with the Secretary of State, and the official that will be notified in case of a pending lawsuit. Agents need to be available during business hours and have a physical location in Alaska, which is why it’s convenient for most professionals to designate a commercial registered agent.
Step 3: Complete your Alaska Articles of Incorporation
This is the first official step in the process of forming a corporation and something that can easily be done online, via mail or by fax. ZenBusiness is on hand to help with sorting out your Alaska Articles of Incorporation. There’s a fee to register your corporation in Alaska. Payments can be may by credit card or by check when submitted by mail. Registration requires the details of your shareholders (incorporates), your business name, your registered agent, and other important details.
Step 4: Establish a corporate record in Alaska
It’s important that your new business has a solid foundation. To do this, start by deciding how the company will be managed, establish clearly defined roles, and document rules and regulations. These corporate records help with compliance and provide an official log of business decisions.
Step 5: Designate an Alaska PC board of directors
It’s customary for public companies to appoint a board of directors who represent the shareholders. The board of directors is responsible for overseeing and managing your company. A board of directors holds more power and has more say than a CEO.
Step 6: Create Alaska corporate bylaws
To secure business loans and bank accounts, you’ll need to create a successful set of corporate bylaws. These can include items such as record books, shareholder documents, contracts, and stock certificates. It’s crucial to file and keep all documents pertaining to your business practices. Alaska law requires that you file an Alaska annual report, which must be submitted six months after you’ve filed your Articles of Incorporation. We also offer a worry-free compliance service to help your business remain in good standing.
Step 7: Hold your first board meeting
The first board meeting is where strategic decisions, financials, and operations should be discussed. It’s advisable to draw up an Alaska operating agreement outlining your company policies and procedures.
Step 8: Handle Alaska tax obligations
Alaska’s business tax obligations are fairly uncomplicated, but consulting an experienced tax practitioner can make things easier. Your corporation needs to be registered with the Internal Revenue Service, and you’ll need to request an EIN (Employer Identification Number). The EIN is a unique identifier for your company. Additionally, directors in a PC can choose whether the organization is taxed as a C corps or S corps. The second option can help to prevent double taxation if the organization meets certain requirements based on the number of shareholders and type of shares.
Step 9: Obtain Alaska business licenses and permits
All corporations in Alaska need a general business license, which is easily obtainable online. It’s important to note that there might be additional Alaska business licenses needed for specific professional industries on federal, state, and local levels. Our business license report service can give you an overview of these requirements.
Step 10: Acquire insurance for your Alaska PC
Shareholders need to decide on various business insurance options, one of which is workers’ compensation. It’s advisable to take out general liability insurance, and industry-specific insurance, such as malpractice coverage. The Alaska Department of Labor and Workforce Development can guide you in the right direction, or you may wish to consult a licensed insurance agent for personal advice.
Step 11: Open a business bank account
To open a business bank account, you’ll need a few pieces of paperwork, all of which are outlined above. Most importantly, you’ll need your federal tax ID number.
Ready to start your business?
At ZenBusiness, we are proud to support small businesses through a variety of different tools and services. Whether you need a registered agent service, want to reserve a business name, or looking to register a domain, our goal is to help you stay on the road to success. Check out our services, and contact us today to see how we can help you grow your company.
Alaska Professional Corporation FAQ
What are the filing fees for an Alaska professional corporation?
You need to complete your Articles of Incorporation and file these documents before launching your corporation. You’ll need to pay a filing fee, which you’ll need to incorporate into the budget of your new venture. Note that fees change over time, so you should check the Alaska Division of Corporations, Business, and Professional Licensing website for the most recent fee schedule. Payments are accepted by check or credit card. There might be a few other fees when setting up your Alaska professional corporation, which can include anything from biennial reports to compliance certificates.
Do I need a lawyer to form a professional corporation in Alaska?
No. You can fill in the necessary paperwork and opt for the do-it-yourself route, but this can be time-consuming. Although the services of a lawyer aren’t necessary, you might want to consult a professional to take control of administrative tasks. This will free you up to build your business.
Does Alaska have a professional limited liability company (PLLC) entity?
Forming a PLLC in Alaska is not an option for licensed professionals. If you are licensed in Alaska, you can form a conventional LLC.
Can Alaskan professionals from different fields form a professional corporation together?
Professional corporations include vocations such as architects, engineers, accountants, and veterinarians. These fields are distinct in their offerings and thus require all directors or shareholders to share the same profession.
Will I be taxed as an S Corp or C Corp in Alaska?
Your corporation will likely be taxed as a C Corp for state and federal tax purposes, which means that your business is taxed as a corporate entity. This is different from an S Corp where income tax is paid at the individual level. Small businesses can request S Corp status if they have one class of stock and meet certain requirements set by the IRS.