S-Corporation in Florida help wanted

[esdwa]

Hello, as newbie I'd like to first say hi to everybody and let you know I have went through many posts on this great forum that wold help me to understand some of the basic aspects of forming new business as S-Corp. Nevertheless I have decided to post a new thread simply because I have not found clear answers for all questions I have.

I have decided to incorporate my business as S-Corp and being the only person (owner) of the newborn company I would like to clarify some questions that I list below. I would also appreciate you pointing me a right literature, preferably a book that has the answers for these question or just let me know if you know the answer. And I would very much appreciate it.

Just to give you a brief how far I am already in, let me say I already went through company name search process that resulted in success, registration process in DOS Florida State of Corporations. I also successfully completed application with IRS for EIN number which has been already assigned. This all happened in last 3 days. I am the only member and I hold all 100% of the shares.

Now I face filling and submission of form 2553 to be elected as S-Corp. And there are few things I probably need to complete soon but they are not clear to me, therefore I ask for your non-formal guidance. I do not seek legal advise here, I just want to get your informal opinion about these steps:

1. When registering company in DOS I have filed number of shares as 20.

1a. Now, how should I price each share? Should it be any number, let's say $0.1, $1, $10, $50 or else? what determined the value of each share when all I put into my business initially is my intellect and ideas about design project I am about to make come true - I am electronic hobby kits designer and the output of my work is basically IP.

1b. Once shares are priced, should I issue stock certificates and how can I certify them, do I need to do that at all for myself? If yes, I suspect there should be 20 of them, right? Btw, I have already located proper stock certificate as MS Word template and printed it instead of just paying someone $2 or more for a pc. Regarding this...

1c. Stock certificate says I need to apply company seal, does it mean I need to get one? Of whether my signature is enough.

2. Where to obtain a printed or electronic copy of "By-laws" that are for my type of corporation?

3. What is "timed in minutes" for corporation activity and how physically should I register them?

4. What is the simplest way to complete any required initial company meetings
- to distribute company shares (100% will go to me)
- to appoint the board of directors (I am the P but should I assign anyone else as me as well?)

any other meeting required at this time?

5. Finally, any good book or set of rules in printed or electronic format (doe snot have to be for free of course) available out there that you can recommend that would basically tell me what should I do in terms of keeping company procedures required by Corporation and tax law in line.

I would very much appreciate your reply.

[esdwa]

Got a great book today "S-Corporation" Nova Publishing, read entire just today, found answers to all questions listed above. I recommend this book to everyone. Spent $25 on it but saved around $300 for the incorporating fee through one of many agencies out there. Have a good business everyone! :D

[vangogh]

I'm glad you were able to answer your own question. I've been hoping someone would respond to your thread. Your questions were too specific for me to try to answer. I was hoping one of our lawyers or accountants would chime in, but they haven't signed in since you posted.

Sorry you didn't get great help though it still may be coming. Thanks for the book recommendation.

[Evan]

1. When registering company in DOS I have filed number of shares as 20.

1a. Now, how should I price each share? Should it be any number, let's say $0.1, $1, $10, $50 or else? what determined the value of each share when all I put into my business initially is my intellect and ideas about design project I am about to make come true - I am electronic hobby kits designer and the output of my work is basically IP.

1b. Once shares are priced, should I issue stock certificates and how can I certify them, do I need to do that at all for myself? If yes, I suspect there should be 20 of them, right? Btw, I have already located proper stock certificate as MS Word template and printed it instead of just paying someone $2 or more for a pc. Regarding this...

1c. Stock certificate says I need to apply company seal, does it mean I need to get one? Of whether my signature is enough.

2. Where to obtain a printed or electronic copy of "By-laws" that are for my type of corporation?

3. What is "timed in minutes" for corporation activity and how physically should I register them?

4. What is the simplest way to complete any required initial company meetings
- to distribute company shares (100% will go to me)
- to appoint the board of directors (I am the P but should I assign anyone else as me as well?)

any other meeting required at this time?

5. Finally, any good book or set of rules in printed or electronic format (doe snot have to be for free of course) available out there that you can recommend that would basically tell me what should I do in terms of keeping company procedures required by Corporation and tax law in line.

I would very much appreciate your reply.

1. Twenty shares ia a little low. I'd usually recommend at least 100, in case others become a shareholder, as now each share is proportional to 5% of the company (versus 1%).

1a. No par value. Don't bother setting a price, it means nothing.

1b. Yes, issue a stock certificate for as many shares as you want (up to the 20 authorized by the state). Even if you issue 1, you have 100% ownership, as you are the ONLY person that owns shares. Someone else buys a share, 50% ownership, unless you have more than 1 share. :)

1c. Eh, the company seal is an antiquated practice. Finding people that actually buy actual stock certificates is another rare thing, for many small businesses (of the ones I see, though I think David may have a different perception, as the resident attorney here). Don't worry if it doesn't have a seal, just make sure it's printed and kept in your files.

2. You need to write your own bylaws. Samples are available online, or an attorney can draft them. To be quite frank, most corporations I seem to deal with say they have bylaws, but never seem to be able to "find them" because they're so small. You are suppose to have bylaws though.

3. Minutes record what actions the incorporators and initial board transacted, and then the shareholders who elect the first board, and then the board who elects the officers. Of course, this is all you. The state may allow, in lieu of meetings, for you to adopt a resolution that states the actions you're taking. The important part of this is that it is in writing.

For 4 and 5, I do recommend that you find a good attorney and an accountant to work with. Find them now, before you need them, especially sometime after tax season is done. As an accountant, we'd rather meet with you over the summer to discuss issues then, rather than having something come out the following year that could have been prevented at the time.