Starting an S-Corp in Florida can propel your small business. You and your business can take advantage of the benefits of an S-Corp but there are requirements and regulations you must follow as well.
All S-Corps start as corporations that are then converted to S-Corps. There are also rules that you’ll need to know to avoid any mistakes as you start your S-Corp in Florida. Here are the five steps to start an S-Corp in Florida.
What Is an S Corporation?
S Corporations have federal requirements that the IRS sets. All S-Corporations start as corporations and convert into S-Corporations by completing Form 2553. To become an S-Corp, your corporation must:
- Be a domestic corporation
- Have no more than 100 shareholders
- Have only one class of stock
- Have only allowable shareholders, which may be certain trusts, estates, and individuals. It may not be corporations, non-resident shareholders, or partnerships.
- Not be an ineligible corporation.
S Corporation Requirements in Florida
If you want to form an S-Corp in Florida, you’ll form a corporation with the Florida Department of State. After forming your corporation, you’ll file and submit Form 2553. This will allow your corporation to elect to be taxed as an S Corporation.
How to Start an S-Corp in Florida
Starting an S-Corp in Florida takes five steps: you’ll choose a business name, file Articles of Incorporation, apply for a business license, obtain an EIN, and complete and submit Form 2253.
Step 1: Choose Business Name
The first step to start an S-Corp in Florida is to choose a business name. Florida business owners will need to choose a business name that is distinguishable within the Department of State records.
There are additional requirements for S-Corp names in Florida:
- You should search for a business name with the Department of State to choose one that’s available and unique.
- Your business name should include: Corporation, Company, Incorporated, Corp., Inc. or Co.
- You shouldn’t use your business name until after you receive your filing acknowledgement from the Florida Division of Corporations.
Finding a unique brand name and (normal-looking) domain to go with it can be a bit of a time-sink for new business owners. This free tool from Business Name Zone generates name and domain combos for you based on your input – and it only takes a few minutes.
Step 2: Articles of Incorporation
Next, you’ll file your Articles of Incorporation. Along with your business corporation name, you’ll provide additional information:
- Your corporation’s address
- Registered agent name
- Registered agent address
- Registered agent’s signature
- Corporate purpose
- Officer and director information
- Effective date
- Stock Shares
- Incorporator’s signature
There are important details to know during this step in the process for the corporate purpose, effective date, officer/director, registered agent, and stock shares.
First, providing a corporate purpose for non-professional corporations is optional. The effective date for an S-Corp begins when the Florida Division of Corporation files your Articles of Incorporation.
Officers and directors also have requirements when filing your Articles of Incorporation. The addresses and names of your directors and officers are optional. However, if you want to include these names, there’s a format you’ll follow.
Fourth, you’ll need a registered agent to start an S-Corp in Florida. A registered agent can be an entity or individual, but it must have a physical street address in the state.
The registered agent must also provide a signature. For business entities who wish to provide a signature, an individual of the entity must sign to serve as a registered agent.
Finally, to start a corporation in Florida, you’ll enter the number of stock shares your corporation will issue. You must provide at least one stock share to complete your Articles of Incorporation.
Step 3: Apply for a Business License
Third, you’ll apply for a business license to start an S-Corp in Florida. You’ll work with two main business license agencies to get your business license, either DACS (Department of Agriculture and Consumer Services) or DBPR (Department of Business and Professional Regulation).
Florida offers additional business license agencies for health professions and other professions. If your S-Corp will focus on certain professions, you’ll contact:
- Agency for Healthcare Administration (ALFs, home care, nursing homes)
- Agency for Persons With Disabilities (Group homes)
- Department of Children and Families (Day care facilities)
- Department of Financial Services (Insurance agents)
- Department of Health (Clinical social workers, nurses, tattoo artists)
Step 4: Obtain EIN
The fourth step to start an S-Corp in Florida is to obtain an EIN. You can apply for an EIN in three ways, by fax, by mail, or online, and it is free to get your EIN.
There’s only one difference among the ways you can obtain an EIN. The time to receive your EIN will vary from four days (if you apply by fax) to a few weeks (if you apply by mail). While you can receive an EIN immediately if you apply online, you’ll need to complete the application in one sitting.
Step 5: Complete and Submit IRS Form 2553
The final step to start an S-Corp in Florida is to complete and submit IRS Form 2553. This form will allow a corporation to elect to be treated as an S-Corp in Florida. After completing IRS Form 2553, you’ll fax it to the IRS.
How much does it cost to start an S-Corp in Florida?
There are two required fees to know if you want to start an S-Corp in Florida. There are filing fees which cost $35.00, and a Registered Agent Designation fee of $35.00. Together, the required fees cost $70.00 to start an S-Corp in Florida.
There are two optional fees which you may choose to pay. If you want a Certificate of Status, there’s a fee of $8.75. If you want a Certified Copy of your documents, there’s a fee of $8.75 as well.
How long does it take to start an S-Corp in Florida?
While the state of Florida doesn’t have guidelines for when to start an S-Corp, there’s a deadline the IRS sets.
There’s a requirement to file Form 2553 no more than two months and 15 days (or 75 days) after the election takes effect.
Let Us Help You Start Your S-Corp
Starting an S-Corp in Florida can be a wise decision. It can be a great way to grow your business with shareholders and ensure your shareholders avoid double taxation.
When starting your S-Corp, you’ll want to work with professionals who can help your small business thrive. Work with the pros at 1-800Accountant to start your S-Corp in Florida.
This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post. 1-800Accountant assumes no liability for actions taken in reliance upon the information contained herein.