What to Do After Forming a Corporation: Timing and Action Table

checklist for tasks to do after forming a corporationThere are many operational requirements that must be handled when starting business as a California corporation. And some of these requirements have strict timing deadlines. Attorneys and clients should review these requirements and divvy up responsibilities for them. Use this handy table for quick reference of required actions and their timing.

This table’s arrangement is generally chronological, but because of the different dates from which time periods are computed, a strict chronological arrangement that applies in all cases isn’t possible. These are the general requirements most frequently encountered, although not all items in the checklist will apply to every corporation.

Timing

Action

Before starting business

Comply with state business licensing requirements.

Obtain necessary city or county licenses.

Obtain seller’s permit.

File application for federal employer identification number.

Before becoming employer

Obtain workers’ compensation insurance or certificate of consent to self-insure.

Contact agencies administering employment laws, as appropriate.

Within 15 days of becoming subject to California personal income tax withholding law or Unemployment Insurance Code

Register as employer with Employment Development Department.

Within first 3 months and 15 days of “taxable year”

If S corporation status is desired, file S election and Consent of Shareholders.

Quarterly or more frequently, depending on amount of taxes withheld

Remit California personal income tax withholding and disability insurance contributions.

By April 10, August 31, or December 10 (as applicable)

Pay personal property taxes.

8 times per month, monthly, or quarterly, depending on amount of tax

Electronically deposit withheld federal income and FICA taxes.

Last day of month following calendar quarter

File California Quarterly Income Tax Withholding and Unemployment Insurance Returns.

File Employer’s Quarterly Federal Tax Return.

File Quarterly Sales and/or Use Tax Return.

Within 90 days after incorporation

File, with Secretary of State, Biennial Statement of Domestic Stock Corporation.

By 15th day of fourth month of taxable year

Pay first installment of estimated federal income tax.

By 15th day of fourth month of income year

File California declaration of estimated franchise tax and pay all or first installment, depending on amount.

By January 31

Furnish withholding statements to employees.

File Federal Unemployment Tax Return.

By February 28

File California Personal Income Tax Withholding Reconciliation.

On or before 15th day of third month after close of first taxable (federal) or income (state) year

File federal and state income tax returns.

Date designated by county assessor between March 1 and last Friday in May

File Personal Property Statement with county assessor.

It’s important to clearly establish who will take on each task—the attorney or the client. Because many of the tax filings are integrally related to the corporation’s accounting records, responsibilities for the accounting records are especially important to assign at the outset. There are some tasks that must be performed by the client personally or by the accountant, and others that can be performed more economically by the client than the attorney. Consider creating an outline allocating tasks so that everyone is clear on who is doing each one and that nothing slips through the cracks.

Each of the actions in the table are discussed in CEB’s Organizing Corporations in California, chap 3. Note that this table doesn’t cover internal operational requirements, such as regular director meetings and annual shareholders’ meetings; for treatment of these matters, turn to CEB’s Counseling California Corporations.

Other CEBblog™ posts you may find useful:

© The Regents of the University of California, 2018. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

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