Incorporate in Pennsylvania

Incorporation is the process of registering a business as a corporation and making it recognizable under law as its own legal entity. Incorporating a business can be a complicated process because each state has its own requirements for registering and operating a business as a corporation. Knowing the necessary steps and forms, however, will help keep you organized and stress-free. 

With our easy business registration service, you simply answer a few questions and we create your initial paperwork and file it with the state for you. The first business entity registration is free for Rocket Legal+ members—you pay only the state filing fees. Then, you can make and personalize all the legal documents you need for your business. Store everything online in your Rocket Lawyer account.

What is a C-Corp? 

A C-Corp, or C-Corporation, is a common business entity type. More specifically, a C-Corp is a corporation taxed under Subchapter C of the U.S. Code. Under Subchapter C, corporations are subject to tax at both the corporate and individual level (sometimes called “double taxation”). Depending on the situation, this may result in lower or higher tax burdens for the shareholders. 

C-Corps allow for anyone to be an investor and for an unlimited number of shareholders and multiple share classes.

As with other types of corporations, C-Corporations provide a common and well-known legal structure for businesses and offer their shareholders some limited liability. Except for certain instances of fraud or misconduct, a shareholder is not liable for the debts or obligations of a corporation beyond the shareholder's investment into the corporation.

Corporations are treated as a C-Corp by default, unless another type of tax treatment is selected, such as an S-Corp.

What is an S-Corp? 

Like C-Corps, S-Corps provide a common and well-known legal structure for businesses and offer their shareholders some limited liability. However, S-Corps have two main differences from C-Corps: they are taxed differently and they have more restrictions with shares.

An S-Corporation, or S-Corp, is an IRS election that allows a company to be treated like an LLC for income tax purposes, that is, as a “pass-through" entity. Instead of income taxes being owed at both the company and individual level, the income of an S-Corp is only taxed at the individual level, which means it passes through the company directly to the owners and shareholders. Again, this may result in lower or higher tax burdens for the shareholders depending on the situation.

S-Corps have more restrictions regarding shares and shareholders than C-Corps. Specifically, S-Corps can have no more than 100 shareholders, only one class of shares, and only U.S. residents or citizens as investors.

One area of common confusion is what type of entity can elect S-Corp status. Remember that this election is simply a tax choice, not a governance or legal structure choice. Both limited liability companies (LLCs) and corporations can choose S-Corp status if they qualify under the IRS's guidelines.

There are similarities between a Pennsylvania S-Corp and a C-Corp regarding personal liability, management, structure, and compliance. The differences in Pennsylvania, however, come down to the following:

• Ownership Rules: A C-Corp can have unlimited shareholders and unlimited stock classes, but an S-Corp is limited to a maximum number of shareholders, usually 100, and only one stock class.
• Taxes: A C-Corp is taxed separately. It files taxes at the corporate level, then shareholders may also be taxed on the individual dividends they receive. S-Corps are "pass-through" tax entities. No taxes are paid at the corporate level. Instead, owners pay taxes individually.
• Documents: An S-Corp must file IRS Form 2553 to elect S-Corp status. A federal subchapter S-Corporation is automatically a Pennsylvania subchapter S-Corporation as well. If you don't want your business to be a Pennsylvania subchapter S-Corporation, you must file Form REV-976 with the state, an "Election Not to be Taxed as a Pennsylvania S-Corporation."

Your corporation’s name should be unique and make a statement about your business. Make sure it complies with the following Pennsylvania requirements:

• Your name must include "Incorporated," "Company," "Limited," "Corporation," "Fund," "Association," or "Syndicate." You can also use an abbreviation of one of these terms.
• Your name must be unique and distinguishable from all other entity names on file with Pennsylvania's Corporations Bureau.

Need help coming up with a business name for your corporation? Try the Rocket Copilot™ AI Business Name Generator, a free tool to help you brainstorm business names and get started registering your corporation.

Each state has its own personnel requirements for incorporating. In Pennsylvania, one or more persons or corporations may act as an incorporator, but incorporators are not required to be officers, employees, shareholders, or directors of the corporation. Directors must be at least 18 years of age.

There are no residency requirements.

Your corporation's registered office address must include both a street name and number. Your application must be signed by all incorporators, along with their addresses. Post office boxes aren't allowed. You must include the period of time that your corporation will be in existence, if it's not perpetual. You must include the number of shares your corporation may issue, and state if the corporation is organized on a non-stock basis. Your Articles should also state whether your business is incorporated under the provisions of the Business Corporation Law of 1988.

Pennsylvania has publishing requirements. You must publish either your intention to form your corporation, or notice of the actual forming, in two newspapers of general circulation. It's best if you include a legal journal. Pennsylvania also requires the filing of a docketing statement when you file your Articles of Incorporation.

Nearly every state has standard processing times, but not all provide expedited processing for corporations. In Pennsylvania, there are a few fees that you may be charged when you register your business as a corporation. They include the following:

State fee: $125.

• Fee to expedite your filing: $100.

Rocket Lawyer filing fee: $0 $99.99.

• First filing FREE* for Rocket Legal+ members (excluding state fees).
• Get additional filings HALF OFF with Rocket Legal+.

Processing time: 4-5 weeks.

•  Expedited processing time: 10-15 business days.

Note: The above state fees and processing times (including expedited processing fees and times) are provided as a summary and may or may not encompass various fees mandated by your state or local authorities. Your state may also change these fees and processing times over time and without notice. If you have questions, speak to a Rocket Lawyer Business Pro to understand the costs and processing times that apply to your specific filing.

Yes – although it's not the most enjoyable part of owning a business, you must pay taxes for your new corporation. Before you start doing business, apply to the IRS for an employer identification number, or EIN. An EIN acts as your company's Social Security number. The tax structures of S-Corporations and C-Corporations are different, so do some research to decide which is right for your business.

If your corporation has employees, you must also register for Pennsylvania employment taxes.

Pennsylvania requires that corporations create corporate records and documents, such as Bylaws and Minutes, to maintain their corporate status. Your business should keep these documents regardless of whether they're required by your state. They help protect the legality of your corporate status. Requirements for Bylaws and Meeting Minutes differ between states.

We wish you success with your new Pennsylvania corporation! You can count on Rocket Lawyer for all the business, tax, and legal help you need at a price you can afford.

If you are planning to operate in another state, you may need to register a corporation in that state. Rocket Lawyer can help you determine which states you should register in.

Other states may have their own rules for foreign corporations that originate in Pennsylvania or domestic corporations that also operate in Pennsylvania. Talk to an attorney to understand the legal and tax requirements for the state(s) in which you plan to operate.