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August 22, 2017

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Corporations

| 4/21/2017

What is a corporation?
A corporation is an independent legal entity that exists separately from the people who own, control and manage it. It does not dissolve when its shareholders (owners) change or die because it is a separate legal “person.” A corporation can enter into contracts, pay taxes, transact business, etc. The owners have limited liability, meaning they are not personally responsible for the corporation’s debts. Partnerships and sole proprietorships, on the other hand, do not provide personal limited liability.

What is the difference between a profit and not for profit corporation?
Profit corporations are formed to generate income for the owners (shareholders) and their employees. They rely on income and credit arrangements with lenders and suppliers to finance their operations. For profit companies receive income from services rendered or products offered to others in the marketplace; then, distribute their profits between owners, employees, and the business itself.

Not for profit corporations are formed to fund religious, charitable, or educational purposes. They rely on donations and grants from individuals, other organizations and government agencies and direct all of their income into specific programs and services. Not for profit corporations may also apply for tax exemption with the Internal Revenue Service under applicable sections of the tax code (501(c)(3), etc.).

What are social benefit and social purpose corporations?
Social benefit and social purpose corporations are considered “hybrid corporations.” While they are formed and considered as for profit corporations, they differ from traditional for profit corporations by devoting or earmarking part of their profits and/or resources to a nonprofit or socially beneficial cause. They differ from traditional not for profit corporations because they may still distribute dividends to their shareholders. A social benefit corporation allows entrepreneurs and investors to adopt a broadly stated public goal, while a social purpose corporation is dedicated to a more specific cause.

PROFIT CORPORATION
Articles of Incorporation must contain:

  • The name of the corporation, which must include the word Company, Corporation, Incorporated or an acceptable abbreviation that will clearly indicate that it is a corporation, and not a partnership or any other type of business entity.
  • The street address of the principal office and the mailing address of the corporation, if different.
  • The total number of shares that the corporation is authorized to have outstanding at any one time.
  • The name and Florida street address of the Registered Agent who will be responsible for accepting service of process on behalf of the corporation.
  • A statement, signed by the Registered Agent, accepting the appointment as Registered Agent.
  • The name and address of the individual or individuals forming the corporation, the “incorporator(s).”
  • The signature of at least one incorporator.

 

SOCIAL BENEFIT OR PURPOSE CORPORATION

  • Download the form and instructions at Sunbiz.org and submit by mail.

 

NOT FOR PROFIT CORPORATION
Articles of Incorporation must contain:

  • The name of the corporation, which must include the word Corporation, Incorporated or an acceptable abbreviation that will clearly indicate that it is a corporation. (Because it is a not for profit corporation, the name may not contain the word Company or its abbreviation Co.)
  • The street address of the principal office and the mailing address of the corporation, if different.
  • The specific purpose(s) for which the corporation is organized (Important: If you intend to apply for IRS federal tax exemption as a charitable organization, your articles of incorporation must contain a required purpose clause and a dissolution of assets provision. Valuable information on 501(c)(3) qualification is on the IRS website, www.irs.gov.)
  • The manner in which the directors are elected or appointed.
  • Any limitations to the corporate powers as provided in Section 617.0302, Florida Statutes.
  • The name and Florida street address of the Registered Agent who will be responsible for accepting service of process on behalf of the corporation.
  • A statement, signed by the Registered Agent, accepting the appointment as Registered Agent.
  • The name and address of the individual or individuals forming the corporation, the “incorporator(s).”
  • The signature of at least one incorporator.

 

File Online
Visit Sunbiz.org to file your Articles of Incorporation or Organization electronically using the Department of State’s online filing application. A major credit card (American Express, MasterCard, Visa or Discover) is required.

File by Mail
Go to Sunbiz.org to download the appropriate fill-in-the-blank form.
Mail to: Division of Corporations, P.O. Box 6327, Tallahassee, FL 32314.

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