Should you form your corporation in the District of Columbia? We've collected the relevant information that will help you make this decision.
- Qualified workforce
- Home to one of the top 20 metro areas in US
- Tax rate of 9.4%
- Competitive market
Cost of doing business
- $220 filing fee / $300 annual report
- Owner disclosure in original filing
Forming your corporation in the District of Columbia
In order to communicate to the public that your new business is incorporated, its official name will need to end with one of the following signifiers (or a relevant abbreviation): “incorporated”, “Company”, or “corporation.” In addition, it is required that the name of your business is not intentionally misleading to consumers, for any reason. Your company’s new name must also be completely unique, and not deceptively similar to any other organizations name or trademarks. There are also some restrictions imposed on financial institutions as well. Do a FREE name search now.
Board of directors requirements
You will need to form an official board of directors when incorporating in the District of Columbia. Here are the states explicit regulations regarding these directors:
- Required number of directors
The District of Columbia corporations must have at least one director listed in their incorporation documents.
- Age restrictions
Directors of corporations located in The District of Columbia must be at least 18 years of age.
- Residence restrictions
Directors of corporations in The District of Columbia must have and list a physical address that is not a PO box during the filing process.
- What information needs to be included in the Articles of Incorporation?
The District of Columbia requires the names and addresses of each director to be disclosed in incorporation documents.
Requirements for the Articles of Incorporation
The Articles of Incorporation is a document that must be filed during the incorporation process in every state. Here is the information that must be included in this document when filing in the District of Columbia:
The District of Columbia requires the number of initial shares outstanding, and their par value, to be disclosed during the incorporation process. The number of outstanding shares does not affect initial state filing fees.
The District of Columbia does not require officer information to be disclosed during the filing process.
Registered agent information
All District of Columbia corporations must have a registered agent on file, and submit their name and address (which cannot be a PO box). This agent will required to be accessible during standard business hours, and acts as the state’s point of contact with the company. Learn more about registered agents.
If your business is a professional practice
Professional service corporations are permitted to form under the professional corporation (PC) structure.
Corporate record keeping requirements
Corporations are required to keep formal documentation regarding several of their operations. These are the explicit record keeping formalities required by The District of Columbia:
- Records that detail the owners and class of all outstanding stock shares
- Meeting minutes for all shareholder and director meetings
- A copy of all accounting related documents, and records of account
The District of Columbia corporate taxation and fee requirements
There are several tax and fee requirements that must be addressed by corporations in the District of Columbia. They are as follows:
All states have complex taxation requirements. For more information regarding taxes in the District of Columbia it is advised that you visit the state’s official business related website.
Annual report requirements
Corporations in the District of Columbia are required to file a bi-annual report every other year before April 15th, starting in year 2. The cost of this filing is currently $300. DC corporations are also held liable for a yearly franchise tax that is due within 5 ½ months after end the company’s fiscal year. This tax carries a minimum $100 fee. Learn more about annual reports.
Tax identification numbers
The District of Columbia requires an EIN (employee identification number) for all corporations that will have employees, and most banks will require one to open accounts. The District of Columbia does not require corporations to obtain state tax ID numbers. Learn more about EINs.
Business license requirements
The business licenses and permits required in the District of Columbia vary wildly depending on the county or municipality in which your new corporation is located. If you would like to see more in-depth information on licenses and permits, please feel free to visit the content in our learning library that covers business licenses and permits.
S corporation election
The District of Columbia does not recognize S corporations for state tax purposes, and treats all corporations as C corps for taxation. However, a company may form as an S corp in DC for federal tax reasons.
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