A corporation is a complex business organization with rights, privileges, and liabilities. If you’ve decided to form one, you’ll need a lot of information to get started. This is why we’ve gathered all the important details in one place. Learn how to form your Louisiana corporation by following our comprehensive step-by-step guide below.
How do I form a corporation in Louisiana?
Steps to form your Louisiana Corporation
- Name Your Corporation
- Appoint Directors
- Choose an Louisiana Registered Agent
- File the Louisiana Articles of Incorporation
- Create Corporate Bylaws
- Draft a Shareholder Agreement
- Issue Shares of Stock
- Apply for Necessary Business Permits or Licenses
- File for an EIN and Review Tax Requirements
- Submit your Corporation’s first report
To form a Louisiana corporation, you’ll need to work closely with the Commercial Division of the Secretary of State’s office and file the Articles of Incorporation. It’s important to note that it’s often easier to mail your documents due to the complexity of Louisiana’s online filing system, geauxBiz. However, check with your local parish, as some do not allow mailing. You also may need to reserve a business name and obtain an EIN before you can file your Articles of Incorporation online.
To simplify the process of forming a corporation in the state of Louisiana, we’ve put together 10 steps for you to follow:
Step 1: Name Your Louisiana Corporation
What will you call your corporation? Choosing a name is an important first step after deciding to go into business. Louisiana law provides guidelines that must be followed. For example, your corporation’s name must be distinguishable from any business name currently reserved or registered with the Secretary of State.
The name can be in another language but needs to be expressed in English characters. The name can’t imply that the corporation is part of a state or federal government agency. It also must not contain any immoral, deceptive, or scandalous words or any of the following:
- Building and loan
- Credit union
- Electric cooperative
- Redevelopment corporation
Corporate names in Louisiana must include or end with the following:
- Corporation or Corp.
- Incorporated or Inc.
- Limited or Ltd.
If you don’t want to use one of those designators, you can use the word “Company” or “Co.” instead. You just need to make sure it isn’t immediately preceded by the word “and” or the “&” symbol.
To determine if a name is available, the state requires you to do a name availability search online or call the Secretary of State’s office at (225) 925-4704. In Louisiana, these are known as preliminary name searches. The state will do a more thorough search when you file a name reservation by fax or mail with a $25 fee. If available, the name will be reserved for your use only for 120 days. The return address is:
P.O. Box 94125
Baton Rouge, LA 70804-9125
Another consideration when choosing a business name is making sure the name isn’t trademarked by someone else. You can use the US Patent and Trademark Office’s search engine to see if anyone has trademarked your desired name on the federal level. It’s also possible to have a state trademark, one that applies only within the state’s borders. See this page to learn more about state trademarks in Louisiana.
You can also reserve a trademark or service mark with the state for $25 for 120 days. This form is filed when you aren’t ready to register the mark in Louisiana. A trademark is a word, name, symbol, or combination of such that represents your corporation’s goods. A service mark is similar but stands for a company’s services.
Registering a mark in Louisiana can be done before using the trademark or service mark, but you must submit visual samples with your application. It costs $25 to register, plus $75 per class of goods or services.
To more broadly protect your trademark or service mark, you can register it with the United States Patent and Trademark Office (USPTO). It cost $225 or $275 per class code, depending on how you file.
One final name to consider is a “doing business as” or DBA name. A DBA name is used when you want to operate under a name that’s different from the corporation’s legal name. People often use this type of name when they want to use a shorter version of the company’s name. In Louisiana, DBA names are filed at the parish level by your local Clerk of Court office — not with the Secretary of State.
You should ensure the name and mark you want to use are available and registered before spending any money on supplies, marketing materials, or advertisements.
Step 2: Appoint Directors
Those who plan to form a corporation usually hold an organizational meeting to appoint initial directors, create and approve bylaws, and determine the corporation’s share structure. These people are known as incorporators. Louisiana corporations are required by law to appoint and form a board of directors to manage business affairs. Your board of directors must have at least one director but can have as many as outlined in your Articles of Incorporation or corporate bylaws. Corporation owners, such as yourself, can be directors, but directors don’t have to be owners. If your corporation is public, the board’s oversight responsibilities typically include:
- Business performance and plans
- Major risks to which the corporation is or may be exposed
- Performance and compensation of senior officers
- Policies and practices to foster compliance with law and ethical conduct
- Preparation of the corporation’s financial statements
- Effectiveness of the corporation’s internal controls
- Arrangements for providing adequate and timely information to directors
- Composition of the board and its committees
- Role of independent directors
Remember to detail how director elections, resignations, and removals will work in your corporate bylaws. Board changes can always be made later and filed with the state for $25. Lastly, execute an incorporator’s statement after the organizational meeting. This statement documents everything that was decided at the meeting, including the appointment of initial directors. It should be kept safe with the corporation’s private records.
Step 3: Choose an Louisiana Registered Agent
Corporations in Louisiana are required to appoint and continuously maintain a registered agent. A registered agent’s job is to receive service of process and other legal notices for your business. They maintain a permanent physical address for your corporation and are always available during regular business hours.
A corporation’s registered agent can be an individual who is a Louisiana resident. It can also be a domestic or foreign entity authorized to provide registered agent services in the state. You can choose to be your own registered agent, or hire a registered agent service for more privacy and convenience.
Step 4: File the Louisiana Articles of Incorporation
To form your Louisiana corporation, file the Articles of Incorporation with the Secretary of State. In other states, the articles may be called a Certificate of Incorporation or a Corporate Charter. File your incorporation articles in Louisiana if this state is going to be your primary place of business.
The following information is required to file Louisiana Articles of Incorporation:
- Name, purpose, and duration of the corporation
- Number of authorized shares to issue
- Name and address of each incorporator
- Street address of the corporation’s initial registered office
- Street address of the corporation’s initial principal office
- Name and street address of the initial registered agent
- Names and street addresses of initial directors
These are only the minimum provisions required by law to be in your articles. Depending on your corporation’s needs, you may want to file additional provisions with your articles. For example, you may wish to file further details about your authorized shares.
A note about the form: The Articles of Incorporation form issued by the Louisiana Secretary of State may only be used to start a corporation with one share class. If the corporation needs a multiple share class structure, you must compose your own Articles of Incorporation.
Shares of stock are units of ownership interest in a company. A corporation decides on how many shares they are going to issue and authorizes these shares to be issued publicly or privately. Those who purchase or receive shares are known as shareholders. Issuing shares is a way for companies to reward initial investors and raise much-needed capital.
The basic fee for filing the Articles of Incorporation is $75. Expedited 24-hour processing is an additional $30. Priority expedited processing is two to four hours and requires an extra $50. If you prefer to file on paper, you can mail or deliver your articles to:
P.O. Box 94125
Baton Rouge, LA 70804-9125
Please note, the Secretary of State’s office provides a separate form for nonprofit corporations.
Louisiana is also unique in that the state requires corporations to record formation documents on the local level. Within 30 days of incorporation, your Louisiana corporation must submit formation documents to the Clerk of Court in the parish where the registered agent’s office is located. This filing comes with additional fees.
Step 5: Create Corporate Bylaws
Corporate bylaws are a code of rules adopted to manage your corporation’s business and regulate its affairs. They outline all rules and regulations for directors, officers, committees, and shareholders.
In Louisiana, corporate bylaws are created and adopted by your board of directors. They must be consistent with state laws or your articles. Your board also has the power to repeal or amend bylaws in the future.
Step 6: Draft a Shareholder Agreement
The rights and responsibilities of your corporation’s shareholders are to be written within a shareholder agreement. This legal document protects shareholders and ensures equality among them. A shareholder agreement should include their names and contact information, voting rights, and liabilities. It should also set forth how to:
- Distribute dividends
- Amend the agreement
- Sell or transfer shares of stock
- Divide assets upon corporation dissolution
An online template or professional legal services can be used to draft a solid shareholder agreement. A copy of your shareholder agreement must be filed at your corporation’s registered office that’s open daily during business hours. By law, the agreement must be made available to any shareholder or their attorney or legal representative.
Step 7: Issue Shares of Stock
Corporations are required to issue the shares that were authorized in the Articles of Incorporation. You must always keep a record of who owns shares and how many shares have been publicly or privately issued. Shares of stock can be traded or sold after being issued but can only be issued once.
There are two types of stock to consider issuing: common stock and preferred stock. Purchasing common stock is riskier for shareholders but comes with benefits, such as appreciation, dividends, voting rights, and the ability to buy new shares when they are issued. Preferred stock is less risky for shareholders to buy. It doesn’t usually come with voting rights; however, it’s prioritized over common stock and can pay out regularly scheduled dividends.
Your corporation must decide whether to issue a share of stock publicly or privately. Private shares of stock are often issued to managers, employees, founders, or a private investor group. Publicly issued shares mean anyone can buy them. Public companies must file quarterly statements with the U.S. Securities and Exchange Commission (SEC).
To learn more about Louisiana regulations, contact the Securities Division of the Office of Financial Institutions.
Step 8: Apply for Necessary Business Permits or Licenses
Although Louisiana doesn’t have a state-level business license to operate, some parishes and municipalities in the state may require a business license. Other permits or licenses may apply depending on the purpose and operation of your corporation.
The Louisiana geauxBiz online portal provides a place for you to begin your licenses and permits search. There may be local, state, and federal requirements. Hiring an expert service like ZenBusiness to research permits and licenses can save you a lot of time.
Step 9: File for an EIN and Review Tax Requirements
For your corporation to pay taxes, hire employees, and open a business bank account, you’ll need an Employer Identification Number (EIN). The Internal Revenue Service (IRS) issues this unique ID number for free when you file for an EIN online. You can also let ZenBusiness secure an EIN for you as part of our business services.
Your corporation will also need to pay taxes to the Louisiana Department of Revenue if you’re not a tax-exempt nonprofit. Businesses taxed as corporations by the IRS may need to pay corporation income and franchise taxes and withholding tax. To learn more about taxes and how to file online, contact the state’s Department of Revenue.
Step 10: Submit Your Corporation’s First Report
Louisiana law requires an initial report to be submitted with the Articles of Incorporation, which is the first version of your corporation’s annual report. You’ll receive a hard copy in the mail, or it can be filed online. The filing fee is $30 for business corporations and $10 for nonprofit corporations. The annual report for the Louisiana Secretary of State should contain the:
- Corporation’s name
- Address of its registered office
- Name and address of its registered agent
- Address of its principal office
- Name and business addresses of its directors and principal officers
- Total number of issued shares itemized by class and series
The annual report must be filed online each year on or before the anniversary of the date your business was incorporated in Louisiana. For example, if you filed your Articles of Incorporation on July 15, your annual report must be filed on or before July 15 of each successive year.
How much does it cost to start a corporation in Louisiana?
The cost to start a corporation in Louisiana varies widely and depends on many factors. Startup costs must include filing the Articles of Incorporation for $75 but may also include other costs, like name reservation, domain name registration, and a corporate bylaws template.
Permits, licenses, registration renewals, and annual reports all add to the cost of doing business as a corporation in Louisiana. ZenBusiness can help your Louisiana small business follow every step from formation to success. We’ll make it easier for you to run and grow your business.
What are the benefits of a corporation in Louisiana?
Louisiana offers a wide variety of tax credits and business incentives to help startups get going and grow. Over 10 educational, managerial, and financial programs are specially designed to benefit small businesses. They even run two initiatives to support and give back to U.S. military veterans who are starting their own companies.
However, while the corporate structure can protect your personal assets, is recognized outside of the U.S., and allows stock to be issued, it’s important to acknowledge some disadvantages, including double taxation and increased paperwork.
How is an Louisiana corporation taxed?
The Louisiana Department of Revenue taxes corporations doing business in the state. Your corporation may need to file returns for the following taxes:
- Net income tax
- Franchise tax
- Withholding tax
- Sales tax (cities can add on a local sales tax up to 7%)
Depending on your business operations, you may need to also pay an excise tax for one or more of the following:
- Hazardous waste disposal tax
- Liquors alcoholic beverage permits
- Liquors alcoholic beverage tax
- Retail dealers of vapor products
- Telecommunication tax for the deaf
- Tobacco products permits
- Tobacco tax
- Transportation and communication utilities tax
If your corporation is designated and taxed as an S corporation by the IRS, Louisiana will tax your company as an S corporation.
Tax laws are very complicated. If you have any questions or need help filing, it’s best to consult with a certified public accountant.
Louisiana Corporation FAQs
- Does running a corporation in Louisiana involve more paperwork than running other types of businesses?
Yes, a corporation involves more paperwork than a simpler business structure, like a limited liability company (LLC). Corporations are required to make and keep detailed records, reports, and agreements. Issuing stock and being managed by a board of directors adds to the paperwork load for most corporations.
- What is the difference between an LLC and a corporation in Louisiana?
An LLC, or limited liability, company is a business that offers a flexible management structure, personal asset protection, and tax benefits. An LLC is usually managed by the owner(s) or an appointed manager or managers and follows an operating agreement. If you want to issue stock to draw outside investors or grow your business globally, it’s better to go with a corporation in Louisiana. Corporations are managed by a board of directors and other elected officers who follow corporate bylaws to ensure profits and proper operations.
- How do I change my corporation’s name in Louisiana?
To change your corporation’s name, you must file an amendment through the Louisiana geauxBiz portal. Another option is to file a “doing business as” (DBA) name with your local Clerk of Court. A DBA name will allow you to operate under a name that’s different from your corporation’s legal name.
- How many people are needed to form a corporation in Louisiana?
By law, one person capable of entering into a contract is needed to form a corporation in Louisiana. You can have more than one incorporator.
- Can I form my Louisiana corporation online?
Yes, you can form your Louisiana corporation online by submitting the necessary forms via the geauxBiz portal. However, it’s been noted that the website can be difficult to navigate, so it’s sometimes easier to file by mail.
- How do I dissolve my Louisiana corporation?
To dissolve your Louisiana corporation, the board of directors must put forth a proposal to dissolve, and the shareholders must vote to approve the dissolution. Once this is accomplished, you must file the Articles of Dissolution with the Secretary of State. The cost to do so is $75 and can be filed online through the Louisiana geauxBiz portal.