Virginia Processing Times and Fees
Most states have both standard and expedited processing times for corporation filings, and Virginia is no exception. To help you decide the best option for you, we have a list of the average wait times for both filing options.
Virginia also charges a corporation filing fee, along with a charter fee. To see all of Virginia's fees, visit “compare pricing” in our incorporation center.
Deciding Between a Virginia C-Corp or S-Corp Tax Designation
An S Corp and a C Corp are the same in terms of management, structure, liability limits and compliance documents. When you're deciding which form is right for you, here are the important differences you should be aware of:
Ownership Rules: A C Corp can have an unlimited number of shareholders and stock classes. An S Corp may have no more than 100 shareholders and only one stock class. All shareholders in an S Corp must be United States citizens or legal residents.
Taxes: A C Corp is taxed as a separate entity from its owners. It files a corporate tax return and it pays its own taxes on earnings. Individual shareholders may also pay taxes on dividends they receive. An S Corp is not its own entity for tax purposes. It's a “pass-through” entity. It passes income to its shareholders, who then file and pay taxes on their individual returns.
Documents: All corporations are C Corps by default. To become an S Corp instead, you must file IRS Form 2553, Election by a Small Business Corporation, to elect this tax status.
Every state has its own personnel requirements for incorporating. In Virginia, they include the following:
- Age requirement: Virginia does not set age limits for corporate directors.
- Minimum number of directors: Your corporation must have at least one director, although you don't have to choose your board before filing.
- Residency requirement: Virginia does not require that directors live in the state.
If your corporation will have an initial board of directors, you must list them in your Articles.
Other Requirements for Your Articles of Incorporation
In addition to personnel requirements,your Virginia Articles of Incorporation must also include the following.
All corporations must appoint a registered agent. This is a person or business responsible for receiving tax, legal and government documents on behalf of your corporation during regular business hours. Your agent must have a physical address in Virginia. Virginia also requires that your registered agent be either an individual who is one of your directors, a member of the Virginia State Bar, or a company authorized to transact business in the state. Your corporation can't serve as its own agent. Your Articles must list your registered agent's name and physical address, and must indicate which of the above designations your agent fits. Remember, if your agent is also a director, this means you have an initial board, and all director names must be listed in the appropriate section. When you incorporate with us, we can help you designate an agent.
You must also include the following in your Articles of Incorporation in Virginia:
- Your corporation's name.
- The number of shares the corporation is authorized to issue.
- A designation for each class or series of shares, and the number of shares of each, if you'reissuing more than one share class.
- The names and addresses of all incorporators.
You may also include some optional information. Here are some of the things Virginia allows you to include in your Articles of Incorporation:
- Your corporation's purpose.
- A par value for your stock shares.
- Definitions or regulations pertaining to powers or liabilities of shareholders and directors.
Guidelines for Your Name
Choosing the right name is an important part of creating a corporate identity. Make sure yours meets Virginia's requirements.
Your name must include “Corporation,” “Incorporated,” “Company,” “Limited,” or an abbreviation of one of these words.
Don't use a deceptive name, or one that implies a business purpose other than that stated in your Articles or permitted by state law. For example, if you've organized as an electronics store, don't call yourself "Pools Incorporated."
Make sure your name is unique and not deceptively similar to a name already registered or reserved with the state of Virginia.
Virginia restricts the use of certain words in corporation names, including “Bank,” “Insurance” and “Redevelopment.” These words can only be used by companies specifically organized to conduct such business.
Virginia Corporate Taxes & Reports
Although taxes are not very exciting, they're an important part of owning a business, and you must pay them for your new corporation. Before you open for business, apply to the IRS for an employer identification number, or EIN. This number is a federal tax ID similar to a Social Security number. Every business with employees needs one.
Virginia requires that all corporations file annual reports and pay annual registration fees. Both are due by the end of your incorporation anniversary month. The registration fee is based on the number of shares your corporation is authorized to issue. You should not file your report any earlier than three months before your due date.You can request an extension of up to 11 months for filing your report and for paying your fee. If you don't file on time or get an extension, the state imposes a penalty of 10 percent of your registration fee or $10, whichever is greater. If you still have not paid by the end of the fourth month following your due date, the state may terminate your corporation.
Keeping Corporate Records and Ongoing Filing Requirements
In order to maintain your corporate status, Virginia requires that you create and keep other corporate documents. These are the two most important ones:
A corporation's bylaws formalize its management, structure and operating procedures. This document must be consistent with your Articles and with Virginia law.
Corporate meeting minutes provide a record of all decisions and actions taken during meetings with your directors and shareholders. You must keep copies of your meeting minutes for at least three years.
Keep these documents with your other corporate papers. You don't have to file them with the state.We have more detailed information about Virginia's requirements for bylaws and meeting minutes.
We understand how exciting it is to form a new business in Virginia, and we wish you the best of luck. When you're ready to file your corporation, we can make it simple for you.
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.