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The state of North Carolina has a business climate ranking #2 by Site Selection in 2016. This goes to show that businesses can enjoy stable economic growth as well as opportunities that enable such growth. If you form a corporation in North Carolina, you will also be able to benefit from several pro-business programs that are being administered by state agencies like NC Department of Commerce or Economic Development Partnership of North Carolina. Your business can also leverage the low cost of living, a highly educated and motivated workforce and access to four international airports.

How do you form a North Carolina business LLC or Corporation? Here is a step-by-step procedure:

North Carolina LLC Registration and Formation

LLC company formation in North Carolina is governed by 2014 North Carolina General Statutes, Chapter 57D – North Carolina Limited Liability Company Act. The process for registration and formation of an LLC is as follows:

Step#1: Maintain a registered agent

According to NC Gen Stat § 57D-2-40 (2014), a domestic and foreign LLC needs to continuously maintain a registered agent in North Carolina. If you are planning to form a North Carolina business, you will need to appoint an agent authorized to receive service of process on your behalf.

We would take this opportunity to share with you the fact we are one of the top North Carolina registered agents and are familiar with all processes pertaining to the North Carolina State and can provide information and assistance for successful set up of your business!

Step#2: LLC Name Reservation

One of the foremost steps towards company formation in North Carolina is identifying a name for your business entity. What is the process? The process is as follows:

• Identify a name for your business entity
• According to §55D-23 of the General Statutes of North Carolina, the name should contain the phrase or words “limited liability company” or the abbreviations “L.L.C.”, or “LLC”.
• The chosen name should be distinguishable and should not be deceptively similar to the name of any limited partnership, corporation, or limited liability company
• Apply for reservation of name using Form BE-03 (Application to Reserve a Business Entity Name)
• File with the Department of the Secretary of State, Business Registration Department along with the applicable fee of $30. An LLC can reserve its name for a period of 120 days.

Step#3: Articles of Organization and Certificate of Authority

If you are planning to form a North Carolina business LLC then the most important step is to prepare and file the proper documents for a Limited Liability Company. The steps are:

• If you want to register a domestic LLC then you will be required to file “Articles of Organization” governed by NC Gen Stat § 57D-2-21 (2014).
• If your business entity is a foreign LLC then you will be required to file a “Certificate of Authority” pursuant to NC Gen Stat § 57D-7-03 (2014).
• The application or documentation for registration of LLC can be filed with the Department of the Secretary of State, Business Registration Division, in person or online.

We can file the form on your behalf as your registered agent in the state and provide you with certified copies of the LLC registration.

In case, you have any questions regarding how to form a North Carolina business, feel free to call us on 702-871-8678.

North Carolina Corporation Registration and Formation

If you are planning to form a Corporation in North Carolina then here is a step-by-step procedure for registration and formation:

Step#1: Maintain a Registered Agent

According to 2013 North Carolina General Statutes, Section 55-5-01, a domestic and foreign Corporation needs to continuously maintain a registered agent in the state. If you are planning to form a corporation in North Carolina, you will need to appoint an agent authorized to receive service of process on your behalf.

We would take this opportunity to share with you the fact that we are one of the top registered agents in the state and have been responsible for over 11,494 businesses set up in North Carolina. We are in compliance with all regulations in the State of North Carolina.

Step#2: Corporate Name Reservation

In order to form a corporation in North Carolina, one of the key steps is identifying a name for your business entity. The process is as follows:

• Identify a name for your business entity
• According to §55D-23 of the General Statutes of North Carolina, a corporate name should contain the phrase or words “corporation”, “company”, “incorporated”, or the abbreviations “Corp.”, or “Inc.”
• The chosen name should be distinguishable and should not be deceptively similar to the name of any limited liability company, limited partnership, or corporation
• Apply for reservation of name pursuant to Form BE-03 (Application to Reserve a Business Entity Name).
• File with the Department of the Secretary of State, Business Registration Department along with the applicable fee of $30. A business corporation can reserve its name for a period of 120 days.

Step#3: Articles of Incorporation and Certificate of Authority

If you are planning to form a corporation in North Carolina, then the most important step is to prepare and file the proper documents for a business corporation. The steps are:

• If you want to register a domestic corporation then you will be required to file “Articles of Incorporation” pursuant to NC Gen Stat § 55-2-02 (2013).
• If your business entity is a foreign corporation then you will be required to file a ” Certificate of Authority” to transact business in the state pursuant to NC Gen Stat § 55-15-03 (2013).
• The application or documentation for registration of a corporation can be filed with the Department of the Secretary of State, Business Registration Division, in person or online.

We can file the form on your behalf as your registered agent in the state and provide you with certified copies of the incorporation.

If you have any questions regarding North Carolina incorporation or LLC formation, you can simply visit the North Carolina Business formation page.

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What makes North Carolina a good business destination? A state that recorded a total gross state product of $540,497 billion in 2017 is considered to be the 9th wealthiest state in terms of gross domestic product. A startup company North Carolina can be set up under a variety of industries including top industries like agriculture, financial services, and manufacturing. One of the best cities in the state to set up a business is Charlotte as Charlotte metro area is home to almost 8 Fortune 500 companies. The city of Raleigh is not far behind and is home to the SAS Institute (one of the largest privately held software companies in the world) and CaptiveAire Systems (the largest privately held kitchen ventilation Systems Company in the nation).

Business Growth Incentive for New Businesses

North Carolina is home to some of the top companies and brands in the world including Bank of America, Lowe’s Companies, Hanesbrands, Quintiles Transnational Corp, Compass Group, Total, Duke Energy, PRA Health Sciences, Duke University, BB&T and Carlisle Companies among others. Whether you are planning to register a new company in North Carolina as an LLC or a Corporation, there are distinctive advantages that your business can benefit from. Let’s take a look at some of them.

Advantage#1: The benefits of Incorporation or LLC formation

Corporation

• Tax Credit Programs: If you register a new company in North Carolina as a C or S Corporation then you can benefit from the state’s Article 3J Tax Credit Program. The program offers eligible businesses credits on franchise tax or corporate tax, tax exemptions on business property and real property and other tax credits depending on the industry including technology development.
• Pass through taxation: If you register a new company in North Carolina as an S corporation then the corporation or firm will not pay any income tax. Instead, the income or loss of the corporation will be passed on to the stockholders.
• Independent Life: One of the salient advantages of an S Corporation in North Carolina is that it enjoys an independent life. This simply means that the business entity will continue operations undisturbed even if it faced the death or incapacitation of one or more of its stockholders.

LLC

• Infrastructure financing programs: If you register a new business in North Carolina as an LLC, you can benefit from this program. There are a range of financing programs to take advantage of including grants and loans program, funds to construct access roads, funds for business expansion, Job Development Investment Grants, Microenterprise Loan Program, and Job Maintenance and Capital Development Fund Grants.
• Limited Liability: As an owner of a North Carolina LLC, you will be able to enjoy limited liability protection quite similar to what a corporation enjoys.
• Flexible Profit Distribution: A North Carolina LLC has the benefit of being able to select different ways of distribution of profits unlike in a partnership where the distribution is 50-50.

Advantage#2: Incentive Programs for North Carolina Businesses

Once you register a new business in North Carolina, you will be able to qualify for different types of business incentive programs introduced by Federal, state, and other local agencies. Let’s take a quick look at some of the top programs that your business will benefit from:

• North Carolina Opportunity Zones: Your business can enjoy benefits through this program only when you register a new company in North Carolina. As a part of the Opportunity Zone (OZ) program, your business needs to be situated in any one of the 252 census tracts or low-income tracts. The salient benefits are:
  – Temporary tax deferral for your business on capital gains reinvested in an Opportunity Fund
  – Permanent exclusion from taxable income earned on long-term capital gains
  – Step-up in basis for capital gains reinvested in the Opportunity Fund
• Sales and Use Tax Exemptions, Refunds and Discounts: The state offers sales and use tax exemptions, refunds and discounts to eligible businesses. A start-up company in North Carolina can benefit from the exemption on sales and use tax related to sales of machinery and equipment, mill machinery parts or accessories, electricity sold to a manufacturer for use in their facility, with special exemptions in use of piped natural gas. Know More

Apart from these, there are several other business incentive programs like One North Carolina Small Business Program, Green Business Fund, Community Development Block Grant, Industrial Development Fund, Economic Infrastructure Program, North Carolina Rural Economic Development Center Building Reuse and Restoration Grant, and Rail Access Program among others. You can qualify for these programs only after you register a new company in North Carolina.

Are there any Disadvantages of Incorporating in North Carolina?

If you are wondering if there are any disadvantages if you register a new company in North Carolina then it is important to know that the disadvantages are few as compared to the advantages or benefits. The disadvantages are specific to the type of business entity you form. For example, a limited liability company has “Limited Life” while the process of incorporation takes more time than other forms of organization. The bottom line is that North Carolina is one of the best locations to start your business and help it achieve growth.

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After you have registered your LLC or business corporation in North Carolina, what is the next step towards making the business entity operational? You need to check whether your business requires a North Carolina company license or not. If a business entity requires a license or permit and if you have not applied for one, then even after registration or incorporation, your business will not be able to become operational.

It is important to understand that there is no single general license for businesses operation out of North Carolina. At the same time, some businesses may be subjected to several state licensing requirements while others might not require a business license at all.

How to Get a Business License in North Carolina

How do you find out if your business requires a permit or a license, or both? Who is the issuing authority for a business permit or license? How do you apply for business license in North Carolina? Will a business entity require a single license or multiple licenses or permits? The only way to answer these questions is by understanding the process of business licensing.

The following steps would provide guidance towards acquiring a business license in the state of North Carolina:

Step#1: The Industry or Business Type

The type of industry or the activities of a business entity helps in identifying the type of business license required in the state of North Carolina. The licenses or permits to transact in the state re issued by state agencies or county clerks. There are host of boards as well as commissions that administer the issuance of over 700 specialty business licenses and permits.

Let’s look at an example to understand this well.

Type of Business/Industry

• Food establishment and other food services – License is issued by Food & Drug Protection Division of North Carolina Department of Agriculture & Consumer Services
• Liquor selling and serving – Permits are issued by North Carolina Alcoholic Beverage Control Commission
• Entertainment Business – A business license is issued by different counties and hence you will be required to apply for the same at the county office your business is situated in.
• Family child care home and Child care center – License is issued by Division of Child Development and Early Education (NCDHHS)

The bottom line is that you need to check the industry your business belongs to. For example, a restaurant would belong to the “Food Establishment” industry.

Step#2: Licenses issued by City/County

If your business or industry type doesn’t fall under state-wide license then you will have to check with the local city or county office. A business license in North Carolina can also be issued by local counties or cities in which the business is located.

Let’s take a look at an example to understand this better.

City/County: City of Raleigh, NC

If you are planning to start a business in City of Raleigh, NC then you have to apply for and acquire a business license through the Revenue Services Division.

The type of license or permit as well as the required fee is determined by the type of business.

If you were to set up a business that provides Amplified Entertainment then you will require a business license by paying a fee of $500.

The license will be due annually on June 30, and the renewal fee would be $100

On the other hand, if your business is situated in a “defined hospitality district” then you would be required to apply for a Hospitality District Entertainment Permit.

Download Sample Application

Step#3: Issuance of a Business License

How is a business license in North Carolina issued? You have to identify the following to complete the process:

1. The type of business or industry
2. Do you need a license or a permit?
3. Will it be issued by the state or the city?

Once you have identified the above, all you need to do is either download the application online or contact the concerned state department or city of clerk office.

It is important to note that a business license or permit will have to be renewed annually unless specific dates have been mentioned, to keep the business operational.

You can also check the Directory of State Business Licenses and Permits to get a full list of businesses that are issued licenses by various state agencies.

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Known as the “Tar Heel State”, North Carolina has an exporter rank of 15 and a trade balance rank of 37. Some of the top industries or businesses involved in the highly revenue generating export state include Pharmaceuticals, Industrial Machinery, Aircraft, Electrical Machinery, Plastics, Motor Vehicles & Parts, and Cotton among others. Recently, the banking & finance industry has shown rapid economic growth and this is a favored industry for incorporation in North Carolina. Some of the top names in this sector include AONHewitt, BB&T, Credit Suisse, MetLife, Wells Fargo, TIAA, PNC, and Bank of America.

Why Choose North Carolina for Incorporation?

Whether you are planning to form a corporation or a limited liability company in North Carolina, it is a known fact that this is one state that has been consistently recognized for its pro business climate. Business incorporation in North Carolina will provide you with the platform required to grow and become a part of the thriving economy.

There are major benefits that small businesses can gain through various programs being implemented to provide businesses with the much needed support they require as start-ups. There are several programs in place for corporations and LLC’s and some of them are:

• Machinery and Equipment, Sales and Use Tax Exemption: If you set up a company in North Carolina in the manufacturing sector and qualify for this program then your business can benefit from exemption from sales and use tax on manufacturing machinery.
• Job Development Investment Grant (JDIG): It is a discretionary incentive program that is performance based. The main aim of the program is to facilitate cash grants directly to new businesses and expanding companies.

How do you incorporate in North Carolina?

What is the process of business incorporation in North Carolina? What type of documentation is required? These are some of the common questions that you will be confronted with if you are planning to establish a new business in the state. The following steps will help you understand the entire process:

Business Type

What type of business do you want to set up in North Carolina? If you want to set up a company in North Carolina, you can choose to form Profit and Professional Corporations, Limited Partnerships (LP), Limited Liability Partnerships (LLP), and Limited Liability Companies (LLC) among others. The type of business entity you want to form can be a domestic or a foreign entity. The forms and fee will be different for each type of entity.

Business Entity Name

If you have already identified the type of business you want to set up then the next step towards incorporation in North Carolina is to identify a name for your business entity. There are 3 steps towards business name formation and they are:

• Naming Requirements: The naming requirements for LLC as well as business corporation should be pursuant to §55D-23 of the General Statutes of North Carolina. The name of each limited liability company must contain words like “Limited Liability Company” or abbreviations like “L.L.C.” or “LLC”. A corporate name must contain words like “corporation”, or “incorporated” or abbreviations like “corp.” or “inc.”
• Business name search: You need to search for a business name that is not in use currently. You can conduct a name search here.
• Name Reservation: Once you have identified a business entity name, you can reserve the name with the Department of the Secretary of State, Business Registration Department for a period of 120 days.
• Name Registration: If you are a foreign entity planning to set up a company in North Carolina then you will be required to register your business name pursuant to §55D-24 of the General Statutes of North Carolina.

Choose a Registered Agent

A domestic business entity as well as a foreign entity authorized to transact business in the state of North Carolina will have to maintain a registered agent pursuant to NC Gen Stat § 55-5-01 (2013) for corporations and NC Gen Stat § 57D-2-40 (2014) for limited liability companies.

We are one of the respected registered agents in North Carolina and will be responsible towards initiating incorporation in North Carolina through processing of your “Articles of Organization” and “Articles of Incorporation” for domestic corporations and “Certificate of Authority” for foreign corporations.

Articles of Incorporation and Certificate of Authority

You will be required to submit “Articles of Incorporation” governed by 2013 North Carolina General Statutes, Section 55-2-02, if your business is a domestic corporation and a “Certificate of Authority” pursuant to 2013 North Carolina General Statutes, Section 55-15-03, if it is a foreign business entity. In order to streamline the process of incorporation in North Carolina, we can file documents on your behalf through the online process or through expedited process.

Date Stamped Copies

As a part of the process of company incorporation in North Carolina, we will ensure, you receive date-stamped and filed copies that verifies that the state has filed as well as formed your corporation.

Costs and Fees associated with North Carolina Incorporation

What would it cost to set up company in North Carolina? Check Fees here!

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Business Information & Rankings

• North Carolina is the nation’s 11th most populous state. There are currently more than 8 million people live in North Carolina. The state’s rate of growth makes it the 5th highest in the nation from 1995-2000, and by the year 2025, North Carolina’s population is estimated to reach 9.3 million. (NC Commerce).
• Site Selection magazine ranked North Carolina as the number one business climate in the US. (2005)
• World Trade magazine ranked North Carolina as one of the Top Ten Places to do Business. (2005)
• North Carolina ranks 1st in manufacturing employment and 2nd in the number of manufacturing facilities for the Southeast region. (Manufacturing News Inc., 2006).
  Studies show that N.C. workers produce more output per wage dollar than their counterparts do nationally. (Charlotte Chamber of Commerce website).

Cost of living

Crime Rate

North Carolina has the 37th lowest overall crime ranking in the U.S. (FBI, 2004)

Fees & Taxes

Business Inventory Tax
Business inventory is exempt.

Corporate Income Tax
North Carolina’s corporate tax structure consists of a flat 6.9% rate.

Personal Income Tax
North Carolina’s personal income tax system is one of the nation’s most expensive, composed of four brackets with a top rate of 8.25% starting at an income level of $120,000.

Personal Property Tax
North Carolina taxes real property, motor vehicles and personal property (inventories and household personal property are exempt). They do not tax intangibles.

State Sales and Use Tax
Base Rate: 4.5%*
Machinery Rate: 1%

*Most taxable sales or purchases are also subject to the state tax as well as the 2.5% local tax rate levied by all counties, for a combined 7%.

Unemployment Insurance
North Carolina’s new employers’ rate is 1.2% for 2 years.