The costs involved to set up a C corporation, also known as a regular corporation, vary based on the company's state of incorporation. C corporations may incur other start-up fees, such as the cost to publish the company's formation documents in a local newspaper. In addition, the company will have legal fees to pay if the company decides to hire an attorney.
Articles of Incorporation
As a condition of formation, every corporation has to file articles of incorporation, also known as a certificate of incorporation, with the secretary or department of state. The articles of incorporation contain information about the business, such as the name and address of the person who will accept the company's legal documents, as well as the number of initial shares the company can issue. Information contained in a C corporation's articles becomes a matter of public record once the secretary or department of state approves the incorporation document. The cost to file articles of incorporation varies depending on the state where the company forms. For instance, it costs $100, as of 2011, to incorporate in Wyoming, but it costs $300, as of 2011, to file a certificate of incorporation with the Texas secretary of state.
Your cost to set up a C corporation will increase if you decide to hire a lawyer, as opposed to completing the incorporation documents on your own. The legal fees incurred will vary depending on the law firm and the legal services you request. You may have to pay the lawyer on retainer before getting any legal services for your business. Small law firms may charge anywhere from $100 to $300 an hour, while larger law firms may charge $100 to $450 per hour, according to the Cost Helper website. With these costs in mind, it is a good idea to set aside several thousand dollars if you plan to get legal assistance to establish a corporation.
If you do not want to hire an attorney, a number of online third-party companies specialize in helping business owners incorporate. The fee charged by a third-party company to incorporate your business will vary depending on the company you select. A complete incorporation package, which includes services such as name reservation and tax applications, may cost as much as $450, according to the Startup Biz Hub website. This cost does not include the filing fee charged by the state of incorporation.
Licenses and Permits
Corporations have to pay a fee to get licenses and permits to operate the business. The licenses and permits needed to legally operate a corporation vary based on the nature of the company's business activities. Corporations have to get a general business license from the city or county clerk's office where the company operates. The cost of licenses and permits will vary from state to state and from county to county.