The Basics of Corporate Formalities

<p> Upon forming a corporation you take a promise from the government that swears to protect you personal assets from your business assets.  In order to ensure that you are protected you must complete certain tasks called corporate formalities.  These formalities are one of the most important and overlooked things when beginning a business.  <p>

<p> Here are some examples of Corporate Formalities: <p>

<h2> Annual Reports <h2/>

<p> Every business is required to complete an annual or biannual report every year.  Usually this is not a problem because the state will send you a letter to that reminds you to complete the report. Yet if for some reason the report is not done your corporation can go into default which would defeat the purpose of having a corporation and leave your assets unprotected. <p/>

<h2> Annual Meeting <h2/>

<p> You are required to have an annual meeting.  Although not required it is also recommended that you hold regular meetings.  These meetings can take place anywhere.  This is a great opportunity to get away from the office and go hold a meeting at your favorite vacation destination. <p/>

<h2> Proper Notice <h2/>

<p> For each meeting you have it is important to have proper notice.  Send out formal written notices to officers or members of your company.  A formal written notice will inform each member of your organization what day the meeting is going to be held, the time, and the location of the meeting.  It will also have a brief agenda describing the topics that will be discussed.  Finally it will state who needs to attend the meeting.  <p/>

<h2> Resolutions and Minutes <h2/>

<p> Keep a log of resolutions and minutes.  Minutes are a record of what was discussed during a meeting.  A resolution is the conclusion or final decision of the meeting.  Both are absolutely necessary to keep track of your meetings. <p/>