How to Start a Mississippi Corporation

When you plan to start a business in Mississippi, you must decide on the appropriate structure. Starting a corporation may be more complicated than creating an LLC in Mississippi or a sole proprietorship. However, it is not that difficult as well. There are a few guidelines that you should be aware of when it comes to creating Mississippi corporation. Starting a corporation involves a legal process, that is, the process of incorporation.

In this article, I will share a step-by-step guide to start a corporation in Mississippi. I will also enlighten you on the advantages and disadvantages of having a corporation. Some people consider starting a corporation in Mississippi more than other business structures since it has many advantages over other forms.

On this page, you’ll learn about the following:

What is a Corporation in Mississippi
- Common Types of Corporations
How to Start a Corporation in Mississippi
Important Information
- Paying your Taxes in Mississippi
- Cost of Forming a Corporation in Mississippi
Advantages of Starting a Corporation in Mississippi
FAQs

What is a Corporation in Mississippi

In definition, a corporation is a formal organization established by stockholders, shareholders, or other people to make a profit. Like individuals, corporations can undertake contracts, own assets, sue and be sued, pay taxes, limit state and federal taxes, and loan funds from banking institutions.

Common Types of Corporations

Before you start with the process of forming a corporation, you should know what type of corporation you will form. There are several different forms of corporations you can take into consideration, depending on your corporation’s objectives and ownership structure.

C-Corporation: C-Corporation is the most known type of incorporation. They have almost all corporate distinguishing characteristics. Profits are distributed to corporate owners who are taxed at an individual level. The corporation is taxed similarly to a business unit.

S-Corporation: An S-Corporation is set up similarly to a C-corporation but has different tax implications and owner limits. S-corps have no more than 100 stockholders and are not taxed separately. These business units must also file paperwork with the Internal Revenue Service (IRS) to obtain their status.

Non-profit Corporation: Nonprofit businesses are frequently used by religious, educational, and charity institutions to run their operations without making a profit. Thus, a nonprofit corporation is exempt from paying taxes. The nonprofit organization’s gifts, contributions, or cash are reinvested in the company to fund its growth, future endeavors, or operations. Read how to start a nonprofit corp in Mississippi to learn about nonprofit corporations.

If you have a small business, it is recommended that you form an LLC instead of a corporation in Mississippi. LLCs have more tax benefits than other structures. Besides, LLCs protect your personal assets. However, it is wise to consult a legal expert before you start setting up your business in Mississippi.
– LLCBuddy Editorial Team

How to Start a Corporation in Mississippi

To start a corporation in Mississippi, you must follow the below steps that, include forming a corporation name, appointing a board of directors, filing for Articles of Incorporation, drafting corporate bylaws, meeting with the board of directors, issuing stocks, creating a shareholders agreement, requesting for an EIN, and getting a license and permit. All these steps are basic ones. It can be changed depending on the type of corporation you form and the nature of your business.

Step 1: Choose a Corporation Name in Mississippi

Naming your business is one of the most crucial activities during the startup phase. Your corporation name serves as the foundation for your brand. Legal procedures should be taken into account when choosing your corporation name. Choose a corporation name that will enable you to develop a strong brand identity without being hampered by irrelevant factors.

If you are forming an LLC, there is a complete guide on Mississippi LLC name guidelines for a proper LLC name. Here are some guidelines you must follow while naming your corporation in Mississippi-

Your business name must contain entity identifiers, such as “Incorporated,” “Limited,” “Corporation,” or “Company,” or an abbreviation, such as “Inc.,” “Co.,” or “Ltd.”
Exclude any words in your business name, such as “Trust,” “Bank,” “Credit Union,” or “Trustee,” or words related to a government agency, such as “FBI,” “State Department,” or “Treasury.”

Step 2: Board of Directors Initial Appointment

To form a corporation in Mississippi, you must appoint an initial board of directors before making them permanent once the corporation is formed. In Mississippi, you may appoint at least One board of directors. The initial board of directors is in charge of guiding the overall strategy of your business. The structure, responsibilities, and powers given to a board of directors are determined by the bylaws of a company or organization. So, appointing your corporation’s initial board of directors in Mississippi is a big step in forming a corporation.

Step 3: Filing the Articles of Incorporation in Mississippi

After you appoint the initial board of directors in your Mississippi corporation, the next step is to write and file a Articles of Incorporation. In writing, the Mississippi Articles of Incorporation, the corporation name, principal place of business, the purpose of business, Mississippi Registered Agent contact information, and the names and addresses of incorporators and/or initial board members, should be written.

Filing a Articles of Incorporation in Mississippi may be done with one method, that is online. The Articles of Incorporation fee may vary from different states. However, in Mississippi, it costs $50 for filing online.

Online Filing: Create an account/Log in to the SOS site, get the online form, fill it, and submit online
Offline filing: there’s no offline method of filing the documents

Step 4: Draft Corporate Bylaws

Now you are done filing a Articles of Incorporation in Mississippi, the next step is to draft corporate bylaws. Corporate bylaws are the basic rules that control a corporation. It includes the organization’s structure, processes, laws, and rules. As a result, all personnel, managers, and corporation members must obey the firm’s rules.

In creating corporate bylaws, you should include the following on how the decisions will be made-

The responsibilities are given to each officer.
How will judgments in business be made?
Where and when are the annual shareholder meetings?
The minimum number of shareholders required for decision-making.
Location and timing of dividend payments.

Step 5: Hold the First Board of Directors’ Meeting

After drafting the corporate bylaws, gather all the board of directors for the first meeting. This meeting will be finalized by appointing directors to manage the company’s daily operations, approve the bylaws, choose the corporation’s accounting year, and approve the stock issue. All board meetings should have minutes taken and stored with the company’s records.

Step 6: Issuing Stock in a Corporation

After starting your Mississippi corporation, one of the first official corporate actions is issuing stock to the shareholders. Keep track of the number of shares issued to each shareholder and the purchase price. A corporation in Mississippi is managed by its shareholders, who contribute to the business in exchange for ownership shares.

Step 7: Draft and Finalize a Shareholders Agreement

Even though drafting and finalizing a shareholders agreement is unnecessary, I suggest you still comply since it will benefit your corporation and its shareholders. A small business’s shareholders enter into a shareholder agreement contract. It establishes how ownership will be handled in unexpected situations, like a shareholder passes away, retires, becomes disabled, or quits the corporation. Early on in the life of your Mississippi corporation, signing a shareholders’ agreement can help maintain corporate continuity and prevent future disputes.

Step 8: Request an EIN in Mississippi

After everything is in place, you should get or request an Employer Identification Number (EIN). An EIN will serve as the tax ID for your Mississippi corporation. EIN can be obtained from the Internal Revenue Service (IRS). It is a 9-digit number similar to Social Security Number. EIN, however, is distinct from SSN. It is only used for business-related activities, particularly for submitting general taxes. The form must be completed and uploaded to the IRS website.

The application of an EIN in Mississippi can be through the following:

Apply Online- The EIN online application is the preferred method for customers to apply for and obtain an EIN.
Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that Form SS-4 contains all of the required information.
Apply by Mail- The EIN application For m SS-4 can be filed via mail. The processing time frame to receive the mail is 4 weeks.
Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

After you have your EIN number, you can benefit in a number of ways. It will give your corporation the final advantage necessary to operate at full capacity without encountering legal or judicial issues.

Step 9: Get Licenses and Permits for your Corporation in Mississippi

Before your corporation operates in Mississippi, you must have a business license. A business license is a document issued by a government agency that permits you to operate your business in the geographic region that that agency governs. To legally operate your corporation, you’ll need a business license. Numerous corporate licenses need to be filed and renewed regularly. Check out how to get business licenses and permits in Mississippi to know more.

You must also register a DBA name if you intend to conduct business using a name other than your corporation’s legal name. The DBA name is sometimes known as “doing business as” or a “fictitious business name.” Depending on your location, you may need to register the DBA with your state, city, and county. You can skip this step if your business solely uses your legal company name.

Important Information

Paying your Taxes in Mississippi

Even if you have established your corporation in Mississippi, pay your taxes and keep everything up to date so you won’t pay any penalty. Unlike an LLC, there is a corporate tax that every corporation in Mississippi has to pay. On the other hand, they must pay income taxes based on their business income. Some other types of taxes in Mississippi are sales tax, franchise tax (not applicable to all the states), and other state taxes.

Cost of Forming a Corporation in Mississippi

A filing and annual fee must be paid to form a corporation in Mississippi. Without it, your corporation won’t operate. The initial filing fee for a corporation may vary depending on the state. However, in Mississippi, it costs $50 for filing online. The corporation in Mississippi also has to file an annual report (though it might not be mandatory, it is recommended to file one). Ensure you comply with all the necessary fees and costs so your corporation will run successfully and smoothly. If, in the future, you make any changes to your corporation, you must file the Mississippi Amendment. It costs $50 to file an amendment in Mississippi.

Advantages of Starting a Corporation in Mississippi

Limited Liability: The biggest advantage of setting up a Mississippi corporation is that the shareholders are not personally responsible for the debts of the company. As a result, when you incorporate as a corporation, personal assets like homes, vehicles, and other possessions are prohibited. One of the main benefits of setting up a corporation over a general partnership or sole proprietorship business structure is that neither the business nor the owners are held legally responsible for the obligations of the business, even if it means giving up their personal assets.

Limitless Corporation: The fact that a corporation’s existence is independent of its owners is another significant benefit of incorporation. In other words, a corporation has an endless life and will continue operating normally even if the owner dies or decides to sell their ownership.

Advantages in Tax: The deduction of health insurance premium payments made on behalf of an owner-employee is one of the many financial benefits to which corporations are entitled. Corporations also save on self-employment taxes since their revenue is not subject to workers’ compensation, Social Security, or medical taxes. Tax rates on corporate profits are lower than those on individual income.

FAQs

What is required to form a corporation in Mississippi?

To form a corporation in Mississippi, you’ll need a Certificate of Incorporation, Articles of Incorporation, and a registered agent.

What are the state filing fees for forming a corporation in Mississippi?

The state filing fee for forming a corporation in Mississippi is $50.

What is the corporate income tax rate for Mississippi?

The corporate income tax rate for Mississippi is 5.00%.

What is the tax rate for corporate franchise tax in Mississippi?

The corporate franchise tax rate for Mississippi is $2.50 per $1,000 of capital employed in the state.

Where can I find Mississippi’s corporate filing forms?

Mississippi’s corporate filing forms can be found at the Mississippi Secretary of State’s website.

Are there any special requirements for forming a corporation in Mississippi?

Yes, there are special requirements for forming a corporation in Mississippi. These include having a registered agent, filing a Certificate of Incorporation and Articles of Incorporation, and listing an incorporator.

What is the minimum number of shareholders required to form a corporation in Mississippi?

The minimum number of shareholders required to form a corporation in Mississippi is one.

How long does it take to form a corporation in Mississippi?

It typically takes 1-2 weeks to form a corporation in Mississippi.

What is the annual report filing requirement in Mississippi?

Mississippi requires corporations to file an annual report with the Secretary of State’s office every year.

What is the annual franchise tax due date in Mississippi?

The annual franchise tax due date in Mississippi is May 15th.

Is there a publication requirement in Mississippi?

Yes, all Mississippi corporations are required to publish a notice of their formation in a local newspaper within 60 days of filing the Articles of Incorporation.

What type of information is required to form a corporation in Mississippi?

The information required to form a corporation in Mississippi includes the name of the corporation, the purpose of the corporation, the number of authorized shares, the address of the principal office, the name and address of the registered agent, and the incorporator’s name and address.

Does Mississippi offer any incentives for forming a corporation?

Yes, Mississippi offers certain tax incentives for corporations that do business in the state, such as the Mississippi Tax Incentive Program.

Is there a corporate income tax exemption in Mississippi?

Yes, Mississippi offers a corporate income tax exemption for corporations that meet certain requirements.

Are there any special requirements for foreign corporations doing business in Mississippi?

Yes, foreign corporations doing business in Mississippi are required to register with the Secretary of State and obtain a Certificate of Authority.

What are the benefits of forming a corporation in Mississippi?

The benefits of forming a corporation in Mississippi include limited personal liability, centralized management, perpetual existence, and the ability to transfer ownership easily.

Are there any corporate income tax credits available in Mississippi?

Yes, Mississippi offers certain corporate income tax credits, including the Small Business Tax Credit.

Is there a sales tax requirement in Mississippi?

Yes, Mississippi requires corporations to collect and remit sales taxes on all taxable items sold within the state.

Is there a personal property tax requirement in Mississippi?

Yes, Mississippi requires corporations to pay personal property taxes on all tangible personal property owned or leased in the state.

What are the annual report filing requirements for Mississippi corporations?

Mississippi corporations are required to file an annual report with the Secretary of State’s office every year.

Is there a corporate income tax rate reduction in Mississippi?

Yes, Mississippi offers a corporate income tax rate reduction to certain corporations that meet certain requirements.

Is there a corporate income tax filing due date in Mississippi?

Yes, corporations must file their corporate income tax return with the Mississippi Department of Revenue by the 15th day of the fourth month following the end of their taxable year.

Is there a corporate income tax return form in Mississippi?

Yes, corporations must file their corporate income tax return using Form 80-105, Mississippi Corporate Income Tax Return.

Is there an online filing option for Mississippi corporate income tax returns?

Yes, corporations can file their corporate income tax returns online using the Mississippi Department of Revenue’s e-filing system.

Are there any other taxes applicable to corporations in Mississippi?

Yes, corporations may be subject to other taxes such as the Mississippi corporate franchise tax, the Mississippi sales tax, and the Mississippi personal property tax.

What is the process for starting a corporation in Mississippi?

To start a corporation in Mississippi, you must file articles of incorporation with the Mississippi Secretary of State’s Office. You’ll need to select a registered agent, file a certificate of incorporation, and pay the applicable filing fee.

What is the cost to start a corporation in Mississippi?

The cost to start a corporation in Mississippi is generally around $50. This includes the filing fee for the articles of incorporation and the cost of a registered agent.

Does Mississippi require me to have a registered agent?

Yes, Mississippi requires all corporations to have a registered agent in the state. The registered agent must have a physical address in Mississippi and be available during regular business hours.

What are the benefits of starting a corporation in Mississippi?

Mississippi offers several benefits for businesses, including a low cost of living, a business-friendly tax environment, and access to a skilled workforce.

Do I need to hold an initial shareholders’ meeting in Mississippi?

Yes, Mississippi requires all corporations to hold an initial shareholders’ meeting. The meeting must be held within 120 days of filing the articles of incorporation.

What documents do I need to file to start a corporation in Mississippi?

To start a corporation in Mississippi, you must file articles of incorporation with the Mississippi Secretary of State’s Office. You’ll also need to obtain a registered agent, file a certificate of incorporation, and pay the applicable filing fee.

Are there any special regulations I need to be aware of when starting a corporation in Mississippi?

Yes, Mississippi has several regulations and laws that businesses must adhere to, including the Mississippi Business Corporation Act and the Mississippi Consumer Protection Act. It is important to familiarize yourself with these regulations before starting a business in Mississippi.

What type of insurance do I need for a corporation in Mississippi?

The type of insurance you need for a corporation in Mississippi depends on the type of business you are running. Generally, you should have liability insurance to protect your business in case of accidents or lawsuits. It is always a good idea to speak with an insurance agent to determine the type of insurance that is best for your business.

Why Mississippi Corporation is So Important

First and foremost, the Mississippi Corporation is vital for job creation in the state. By fostering a business-friendly environment and attracting investments, this corporation helps in generating employment opportunities for residents. A thriving business sector not only provides jobs for individuals but also contributes to reducing unemployment rates and improving the overall quality of life for Mississippians.

In addition to job creation, the Mississippi Corporation also plays a crucial role in driving economic growth and development in the state. By supporting small and large businesses, this corporation ensures that entrepreneurial efforts are encouraged and nurtured, leading to innovation and economic diversification. A strong business sector stimulates economic activity, attracts investments, and boosts the state’s GDP, making Mississippi a lucrative destination for businesses and investors alike.

Furthermore, the Mississippi Corporation is instrumental in fostering a competitive business environment that benefits both businesses and consumers. Through its regulatory framework and support services, this corporation ensures that businesses operate ethically and sustainably, promoting consumer trust and confidence. By enforcing compliance with laws and regulations, the corporation safeguards the rights of consumers and ensures fair competition, which in turn leads to improved products, services, and overall market efficiency.

Moreover, the Mississippi Corporation plays a vital role in promoting corporate social responsibility and sustainability. By encouraging businesses to adopt sustainable practices and integrate social and environmental concerns into their operations, this corporation contributes to the well-being of society and the environment. By fostering a culture of responsible business conduct, the corporation helps in creating a more sustainable and inclusive economy that benefits all stakeholders.

Overall, the Mississippi Corporation is a key player in the economic development and prosperity of the state. Its role in job creation, economic growth, and corporate social responsibility is crucial for ensuring a sustainable and prosperous future for Mississippi. As such, it is imperative that the Mississippi Corporation continues to play a proactive and facilitative role in supporting businesses, fostering innovation, and promoting sustainable economic development for the benefit of all Mississippians.

Conclusion

When determining which corporate form is best for you, be selective. You must know which business structure is bet-fitted for your product/service in Mississippi. Consult a legal professional before you take the first step while setting up your business. Finding the ideal ratio of corporate advantages and legal protection that meets your unique needs is very important. In forming a corporation in Mississippi, you need to ensure that every detail is well-formed so that your corporation will be successful. And if you have any questions, share them in the comment section below.