A corporation is a creation of the state because its life is depending on state lawsƒ¤. It does not exist any general federal corporation law that governs the structure and the function of private corporations, but there are several federal laws, such as securities laws, labor laws, antitrust laws, consumer protection laws, environmental protection laws and

In our case , Henry wants to incorporate. For his own convenience he should choose an S corporation because after a specific time and if tax advantages for his firm are regular he can drop it. He will have the rights and benefits of a regular corporation and he will be released form the double taxation.

In order to incorporate, he must take some steps required in this procedure. Henry must first choose a state in which he will incorporate. He should choose a state that incorporation provisions and taxation are convenient for him and if it is a small one , he should choose the state where he will be doing most of his business. Next he should find incorporators who are persons, partnerships or other corporations that will handle and be responsible for the processes of incorporation. Then he must file the articles of incorporation or corporate charter, which is the basic document that corporations operate. This document should be filed and approved by the state before the corporation can be officially incorporated. The articles of incorporation must conclude all the basic information about the company and its business functions. For example: The corporate name, nature and purpose, duration, capital structure, internal organization(management), the address of the registered office and agent, the names of the incorporators and any other necessary provisions. The charter can be amended later to include any other necessary information required. The amendments are adopted by the board of directors and approved by the shareholders.

Most corporations adopt a corporate seal which is a design that contains the name of the corporation and the date of incorporation. It is imprinted by the corporate secretary on certain legal document using a mental stamp containing the design.

As every kind of business, corporations have some disadvantages. Their formation is difficult and expensive. A professional, such as an attorney may be needed to complete the legal forms and apply for the articles of incorporation to the state. These fees, other organizational costs and in general the costs of this process, discourage many people to form a corporation. Another disadvantage are the government regulations. Although they are designed to protect the owners, they make many operations complicated. For example, to sell its stock, it must meet several rules. It has to file several reports about the operation o

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