Start a West Virginia Corporation

Congratulations on deciding to start a business in West Virginia! Like a limited liability company (LLC) or other business structure, creating a corporation can be exhilarating, but it can also be challenging. Many things will need to be done, like putting your idea together, getting the proper paperwork done, hiring employees, securing business insurance, and more. Whether you’re a seasoned business owner or a beginner, we’ll shed some light on forming a corporation in the Mountain State if you have a solid business idea.

We’ll walk you through some steps to keep your corporation compliant with West Virginia law while offering helpful tips along the way.

How do I form a corporation in West Virginia?

To officially begin operating as a corporation, you’ll need to file your Articles of Incorporation with the state. But, before you jump the gun, we’ll walk you through the work you’ll need to complete. Here are 10 steps to keep in mind.

Step 1: Name Your West Virginia Corporation

The first step in the process is naming your business in West Virginia. Choosing a business name can be fun, but make sure it’s fitting for what you offer. To abide by state law, avoid using words in your business name that could be offensive or derogatory. Compile a list of possible names.

Once you have your list, you’re ready to run your options through the West Virginia Secretary of State’s Business Organization Search. Make sure the name is not already taken by another company.

Choosing a corporation designator

When you find a unique business name, you’ll need to decide on an official corporation designator to add to the suffix. In West Virginia, you can from any of the following approved designations:

• Corporation (Corp.)
• Incorporated (Inc.)
• Company (Co.)
• Limited (Ltd.)
• Foundation (only for nonprofit corporations)

If your corporation name is “Maxwell’s Restaurants,” your official name might be “Maxwell’s Restaurants Co.” or “Maxwell’s Restaurants, Incorporated.”

Reserve your West Virginia corporation’s name

After you’ve chosen a designator, reserve a name for your business in West Virginia. You can fill out the Application for Name Reservation and send by email (CorpFilings@wvsos.gov), fax, or deliver in person.

Reserve your name for 120 days

There is a $15 filing fee, and your name is reserved for 120 days. You can deliver your form to the Charleston Office, the Clarksburg Office, or the Martinsburg Office. Specific addresses can be found on the form. You can also utilize our name reservation service.

We recommend making a few additional decisions about your company name before moving on to Step 2.

Check your corporation’s name isn’t already trademarked

Whether or not you plan on trademarking your business name, you should at least check if it’s infringing on someone else’s trademark. At the state level, you can visit the West Virginia Secretary of State website to see if a trademark exists. You can also search on the federal level by visiting the United States Patent and Trademark Office’s (USPTO) website. Learn more about registering a trademark.

If your company will do business or make sales under a separate name, you’ll need to secure a trade name, also known as a “doing business as” (DBA) name. You can fill out the trade name application online. There is a $25 filing fee. We can help to register your DBA name as well.

Step 2: Appoint Directors

Next, it’s time to select a board of directors for your company. All West Virginia corporations must appoint at least one director to their board. Your corporation’s directors serve your company’s best interests. A corporation’s board of directors will also agree to and uphold company bylaws.

You’ll also want to choose an incorporator. This is the person who fills out and signs your Articles of Incorporation in step four.

Step 3: Choose a West Virginia Registered Agent

Every corporation in West Virginia must have a registered agent. This agent will receive important government communications, such as tax paperwork, lawsuit notices, and other official correspondence on your corporation’s behalf. We can help you get a West Virginia registered agent.

Registered agent qualifications

In West Virginia, a registered agent must be over 18 and hold a residence within the state. Alternatively, this agent can be a domestic or foreign corporation with a registered office in the state. Lastly, your agent must be available during normal working hours to receive government communications.

Some corporations pick someone within their company to serve as their registered agent. While this is legal, it’s not always a smart idea. There are several downsides:

• Disclosing private information. When you become a registered agent, you agree to have some of your personal details become public record.
• Legal interruptions. Since these agents receive sensitive legal documents like subpoenas or summons, when you act as your own agent, these papers will be served at your office in front of new partners or customers.

Step 4: File the West Virginia Articles of Incorporation

It’s finally time to register your corporation with the West Virginia Secretary of State. You’ll do this by completing your Articles of Incorporation. This document must be filed before your company can officially conduct business.

How to file this form

In West Virginia, you can file your Articles of Incorporation online (you’ll need to create an account with the One Stop Business Portal First), by email (CorpFilings@wvsos.gov), by fax, or by delivering them in person. To file this form, you’ll need the following:

• Your official corporation name
• Your company address
• Your registered agent’s name and address
• A business email address
• A business website address (if one exists)
• Details on any other existing businesses
• Nonprofit or for-profit designation
• Share information (number of shares, the price per share)
• Your corporation’s business purpose
• Your company’s incorporators (at least one)
• Acres of land that your company holds or expects to hold
• Signature of incorporator

You’ll be charged a $100 fee if you’re a for-profit corporation and only $25 if you’re a nonprofit. The fee is waived for veteran-owned and Young Entrepreneurs corporations. If delivering your form, bring payment and the document to the Charleston Office, the Clarksburg Office, or the Martinsburg Office. Specific addresses are located on the form. 

Step 5: Create Corporate Bylaws

Your company’s corporate bylaws are important for dictating how your company will be managed and run. Although they aren’t required to be submitted to the West Virginia government, everyone in your company should understand them and have a copy.

Your company bylaws may include your basic operating procedure, management structure, rules and regulations, shareholder information, board voting rules, and share information.

Step 6: Draft a Shareholder Agreement

Once your bylaws are established, you can draw up a shareholder agreement. This details the relationship between the shareholders and the corporation. This agreement exists largely to outline obligations and safeguards the rights of the shareholders. Each should read and sign this agreement.

This document should follow the general principles and operational procedures outlined in your bylaws. It should contain more detail around shareholder roles, voting procedures, and shares.

Step 7: Issue Shares of Stock

Once your agreements are in place, you can begin issuing shares of stock, which is required for this business type in West Virginia. Since you noted your number of shares in your Articles of Incorporation (and price per share), you’ll want to make sure you agree to those same amounts.

Selling shares

You can sell your shares privately or publicly. When you sell privately, your shares are dispersed among a relatively small group, such as the founders, directors, and employees of your corporation and/or a group of private investors. When you sell publicly, your shares will be available in the marketplace where anyone can purchase them. 

Filing quarterly stock forms

Keep in mind that if you decide to sell shares on the public market, you’ll be required to file quarterly stock forms with the U.S. Securities and Exchange Commission (SEC) to remain compliant with state and federal laws. You will also have to register with the West Virginia Securities Commission.

Step 8: Apply for Necessary Business Permits or Licenses

There will be necessary permits or licenses for your corporation to be seen as a legal business entity. Every West Virginia business is legally required to get a business registration certificate from the State Tax Department. You obtain this via the portal or by mail.

Types of licenses

Licensing can be federal, state, local, or industry-specific, so do a thorough search to make sure your business has everything it needs. In particular, reach out to your county and city governments about any local licenses and permits.

Industry-specific licenses or permits

Depending on your area of service, you may need to apply for industry-specific licensing or permits. You can view the specifications for state licensing on the West Virginia Division of Labor website. You can also learn if your corporation needs to obtain special state licensing here.

Step 9: File for an EIN and Review Tax Requirements

You can officially register your West Virginia corporation with the Internal Revenue Service (IRS). You can do this by requesting an Employer Identification Number (EIN), which serves as your company’s version of a Social Security number. 

Using and registering for an EIN

With your EIN, you can open corporate financial accounts (like a business bank account), hire workers, and pay taxes. You can register for your EIN online through the IRS. The process is quick and free. You can also register for an EIN with us.

Taxes for C corporations

If your corporation is a C corporation, it will be subject to West Virginia corporate income tax as well as federal income tax. When you get the business registration certificate described in the previous step, you will also have registered with the state’s Tax Department.

Other tax requirements

Next, you’ll want to check other tax requirements. If you are paying employees, you’ll want to establish a wage withholding account through the state’s Tax Department. This will pull federal and state taxes from your employees’ payroll checks to ensure your corporation remains tax-compliant.

If you collect any form of sales tax, you’ll need to set up a municipal sales and use tax account through the state.

Step 10: Submit Your Corporation’s First Report

The final step in starting your corporation is filing your first annual report. This report is due every year and must be turned in to ensure your corporation remains compliant.

You can submit your annual report online. All forms are due by July 1 for the previous year. There is a $25 filing fee (and a $50 late fee).

How much does it cost to start a corporation in West Virginia?

The exact cost you’ll spend starting your West Virginia corporation will vary depending on whether you’ve worked with tax specialists or consultants. Typically, you should expect to be charged a minimum of $100 to file your Articles of Incorporation.

Of course, you’ll spend more if you reserve your business name or register a trade name. This $100 baseline cost also doesn’t include securing required business licenses or filing your annual report.

What are the benefits of starting a corporation in West Virginia?

In West Virginia, many business owners start a corporation because of the protections and benefits this business type offers.

A few include:

• The separation between the company and individual finances. When you form a corporation, your personal finances are protected if your company runs into financial problems.
• Protection from legal liability. If you decide to start a corporation, you will not be held personally liable for lawsuits directed at the company.
• Access to a global market. When you incorporate, you are allowed to offer your products and services around the world.
• More respectability. Clients, partners, and investors tend to take companies more seriously if they’re incorporated.

A few drawbacks include: 

• Taxation regulations. Unfortunately, corporations are subject to what is known as “double taxation.” This means shareholders will be taxed on profits twice: once at the corporate level and again at the individual level.
• Stricter rules and regulations. Corporations have to follow much stricter reporting regulations than other companies. This business entity also has less freedom when structuring the company. For example, corporations are required to choose directors, an incorporator, and to issue stocks.

How are West Virginia corporations taxed?

Taxes work differently depending on what type of West Virginia corporation you form. There are three main types: the C corporation (C corps), the S corporation (S corps), and the nonprofit corporation. By default, your company will be registered as a C corporation unless you pick a different type. 

C Corporations

C corps are separate legal and taxable entities from their owners (shareholders). This designation requires a corporate tax on profits. In addition, shareholders will be subject to an individual tax on earnings.

S Corporations

S corps are seen as pass-through business entities. This designation allows the profits to essentially pass through to the shareholders and owners, who would then pay taxes on their profits on personal tax returns. S corps do not have to worry about corporate taxes.

Nonprofit Corporations

A nonprofit can apply with the IRS to be exempt from paying federal taxes as long as they follow federal guidelines. If it successfully applies to be federally tax exempt, it is also exempt from paying a state income tax in West Virginia and sometimes sales and use taxes.

We can help

Whether you’re in Parkersburg or Wheeling, our suite of products and services is here to help you start, run and grow your business. If you’re looking to form a West Virginia LLC instead of a corporation, we can help you there too. No matter what phase your business is in, we are here to help. Reach out to us today!