Tips on Florida Incorporation 

In recent years, Florida has become one of the more preferred states for businessmen to conduct their affairs. In fact, it has been consistently a leader in incorporating new businesses. Florida has a very favourable business environment:

• Very competitive tax system
• A big population of skilled workers
• About fourteen trade zones
• Large business parks

Below are some basics you should consider when it comes to Florida Incorporation:

1. Naming your business properly is important. It should be distinguishable from other companies and contain “Corporation”. It must also not have words that imply any other purpose other than what is stated it its articles of incorporation or the corporate laws of the state.

2. The director of your corporation must be at least 18 years old. Florida does not require any residency, so you can do business here even when you live elsewhere. Additionally, they also do not require that the names of corporate officers including directors be placed in its articles of incorporation. A corporation in Florida may have its officers serving as directors.

Businesses in Florida are mandated to file a Uniform Business Report annually for $150. This is due every 1^st day of January and not later than May 1^st. They are also required to have a license for a certain fee.

3. Florida is one of the first states to establish public access on the internet. As such, filings of important papers, such as certificates, may now be obtained and paid online. This makes running the business easier and hassle free.

However, a contact person must still be stationed in Florida to oversee things, in case there are problems that should arise with filing. This is actually required by Florida laws. If the company does not wish to have an individual overseeing their affairs, a service agent may be hired. The agent must be registered in Florida. The agent must also have a valid address and not just a PO Box. The agent performs the following functions:

• To receive and forward legal documents
• To receive and forward tax and annual report forms
• To accept and forward service of process

4. A franchise tax is imposed on both foreign and local corporations and is equal to 5% of the corporation's net income. In the first year of business, the first $5,000 net income is exempt from taxes (S Corporation). An S Corporation must file Form F-1120, the Corporate Income Franchise tax. For the following years, S Corporations may file F-1120 if they have a federal taxable income.

Florida also imposes tax claims, like Sales and Use Tax Exemptions, which is very beneficial to corporations. This is one of the reasons why the state is regarded to be pro-business by many entities.

There is no personal income tax in Florida. Hence, shareholders are not taxed from their corporate earnings.

Incorporating your business in “business friendly Florida” limits your company's liabilities. In case something goes wrong with the market or your business, you are very well protected from going bankrupt especially when you follow the state's incorporation guidelines.