When most Nevada residents think of a corporation, they are likely thinking of a C-corp. C-corps are corporate entities created to operate as a business, which protects shareholders from liability. There are pros and cons to starting a business as a C-corp, but, once the business is created, there are quite a few ongoing legal obligations that must be maintained.
For starters, taxes may be the most important part of running a C-corp. On a basic level, C-corps face double taxation, in that taxes must be filed for the corporate entity itself, but the profits or dividends that are distributed to shareholders are also taxed. Complying with corporate taxation can be a time-consuming and incredibly detailed process, as is complying with all applicable securities law.
Next, detailed records and bookkeeping is one of the primary tasks to complete in the ongoing legal obligations of a C-corp. Accounting records and minutes from board meetings are crucial documents to maintain. The makeup of the board that governs the C-corp is also crucial. These need to be individuals who have the best interests of the business and its shareholders in mind. Lastly, articles of incorporation will need to be drafted as the C-corp is created, but it is important to continue to monitor state and federal law to ensure that those articles stay in compliance with all applicable business regulations.
The failure to comply with these ongoing obligations can result in serious business law problems for a C-corp. Compliance should be one of the main focuses of any corporation in Nevada.
