State Processing Times and Fees
Nearly every state has standard processing times for filing a corporation, but not all provide expedited processing. Check the average wait times for both standard and expedited filing times, because they vary between states and change periodically.
New Jersey charges a filing fee for incorporating. Visit "compare pricing" in our incorporation center to see all state fees for New Jersey.
Deciding Between a New Jersey C Corp or S Corp Tax Designation
There are similarities between New Jersey S Corps and C Corps regarding personal liability, management, structure and compliance. The differences in New Jersey come down to the following:
- Ownership Rules: A C Corp is taxed as a separate entity from its shareholders. Shareholders also report and pay taxes on what the corporation pays them. An S Corp is taxed like a partnership with a "pass-through" tax structure. It's not doubly taxed because the corporate entity can pass income, losses, deductions and credits to its shareholders for federal tax purposes. Corporate owners pay taxes on their shares of the corporation's profits at their individual tax rates.
- Documents: If you want to form an S Corp, you must file IRS Form 2553 to elect this status. To qualify as an S Corp, your business must be a domestic corporation, provide only one class of shares, have no more than 100 shareholders, and your shareholders can include only individuals, certain trusts and estates.
Each state has its own personnel requirements for incorporating. In New Jersey, they include the following:
- Age requirement: Directors must be at least 18 years of age.
- Number of directors: At least one director is required.
- Officers: There must be a president, secretary and treasurer.
- Residency: There is no requirement that directors must live in New Jersey.
- Inclusion: The names and addresses of the initial directors must be listed in your Certificate of Incorporation.
Other Requirements for Your Certificate of Incorporation
In addition to personnel requirements, your New Jersey Certificate of Incorporation must also include the following:
You must appoint a registered agent. A registered agent is a person or business designated by you to receive important tax, government and legal documents, including service of process of lawsuits, on behalf of your corporation. The agent must be available during normal business hours. New Jersey requires that you include the name of your registered agent in your Certificate of Incorporation. Your agent must have a physical address in New Jersey. Your corporation cannot act as its own registered agent. We will help you designate your registered agent when you incorporate with us.
You must also include the following in your Certificate of Incorporation in New Jersey:
- The number of shares authorized to be issued.
- The par value of the shares.
- The name of the corporation.
- The corporation's purpose.
- The corporation's duration, if it's not perpetual.
- The names and addresses of the incorporators.
Other Required Paperwork
Your corporation must file an annual report with the New Jersey Department of State. The report is due on or before the last day of the anniversary month of your incorporation.
Guidelines for Your Name
Your corporate name must be unique and it should make a statement about your business. It must comply with the following New Jersey requirements:
- Your name must be distinguishable from that of any other registered business in New Jersey. It must end with "Corporation," "Company," "Incorporated," or an abbreviation of one of these terms. You can also use the abbreviation "Ltd."
- Your name cannot be deceptive. If you're selling boats, don't name your company "Springfield's Jersey Shore Dry Goods."
- Ensure that your name is distinguishable from any other existing corporate names.
New Jersey Corporate Taxes & Reports
Unfortunately, you must pay taxes for your new corporation. Get started by applying to the IRS for an employer identification number, or EIN. All corporations with employees require an EIN. An EIN is similar to your Social Security number, but it's for businesses. You'll need an EIN to open your corporate bank account.
Many business owners choose S-Corps because they're generally exempt from federal corporate income tax and there is no double taxation. A C-Corp offers more flexibility. You can have several classes of shareholders with different voting rights, but there are tax implications.
Keeping Corporate Records and Ongoing Filing Requirements
New Jersey requires that you create certain records to maintain your corporate status, including bylaws and corporate minutes. Bylaws set forth your company's operating rules and define the responsibilities of your directors. They also explain the rights and powers of your shareholders, and they can address all other corporate matters. You don't have to file your bylaws with the state in New Jersey, but you'll need them to demonstrate to banks, lending institutions, creditors, the IRS and the courts that your corporation is valid and legitimate. Bylaws also help to establish rules so you can keep your corporate assets and debts separate from your personal ones.
New Jersey requires that corporations keep minutes of director and shareholder meetings, their most recent annual report, a list of names and addresses of the directors and officers, the Certificate of Incorporation with any amendments, and their bylaws at their corporate office. Corporate minutes keep track of all votes on important business decisions and help secure your corporate status.
Best of luck with your New Jersey corporation. We have all the legal documents, filing and tax information you'll need to get started.
This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.