Key Takeaways

  • To incorporate in Tennessee, businesses must file Articles of Incorporation (charter) with the Secretary of State.
  • The filing requires details such as company name, purpose, registered agent, incorporators, and authorized shares.
  • Tennessee requires bylaws, at least one director, and an annual report filing by the 4th month after the fiscal year ends.
  • Filing fees vary by entity type and are due at the time of charter submission.
  • Corporations pay excise and franchise taxes in Tennessee, with a minimum franchise tax of $100.
  • Incorporating offers benefits such as liability protection, credibility, and the ability to issue shares.
  • Tennessee also requires corporations to register for state tax accounts and comply with licensing at the county/city level.

Tennessee articles of incorporation are included in the organizing document for a new corporation, which is referred to as a charter. The charter must be filed with Tennessee's Secretary of State before the corporation can commence operations. Charters are required for all corporations, whether profit or non-profit. Limited liability companies must file an article of organization.

If the article of incorporation is approved, it creates the corporation's legal entity and secures the corporate name. After approval, the corporation can then sign contracts, obtain business licenses, apply for tax IDs, and conduct business activities.

In Tennessee, articles of incorporation can be filed in person, by fax, or by mail. It usually takes the Secretary of State two to four business days to process filings. Incorporating a business provides some important benefits including:

  • Adding credibility and providing governance
  • Fulfilling all statutory requirements for registering a business name
  • Limiting the liability of shareholders, officers, and directors

Filing an article of incorporation in Tennessee requires the inclusion of the following information.

Company Name

The name must be unique and distinguishable from other entities such as limited liability partnerships, limited partnerships, liability companies, business corporations, and other nonprofit organizations that are registered with Tennessee's Secretary of State. The chosen name must contain "company," "incorporated," "corporation," or their abbreviated forms, (corp., inc., co., or ltd.) inclusive of abbreviations or names in a foreign language.

Company Purpose

Individuals must list the business or activity that the corporation will engage in or the reasons for forming the corporation.

Authorized Shares

Individuals are required to list the number of shares they are currently authorizing. This is the point where stocks for the corporation are created. The created stocks are issued to shareholders at the first shareholder meeting.

Filing Fees in Tennessee

When you incorporate in Tennessee, filing fees depend on the type of entity and share structure. For-profit corporations typically pay a base filing fee of $100 plus an additional $0.10 per authorized share, capped at $3,000. Nonprofit corporations have a flat filing fee of $100. Limited liability companies must also pay filing fees when submitting Articles of Organization, with costs starting at $300 depending on member count. These fees must be paid at the time of submission and are nonrefundable.

Registered Agent

Also known as a resident agent, a registered agent is a business or an individual that officially represents the corporation in all legal matters.

Names and Addresses of Incorporators

Incorporators are individuals or business entities who are authorized to form a corporation. Incorporators are not stakeholders in the corporation and have no claims on the corporation being formed. In Tennessee, the corporation's directors must be listed, but it's not required to list officers.

Additional State Requirements

Beyond filing the charter, Tennessee requires corporations to maintain compliance with additional rules:

  • Bylaws must be adopted to outline governance, roles, and responsibilities.
  • At least one director is required, though corporations may have more.
  • One officer is required, and one person can hold multiple officer roles.
  • Annual shareholders’ meetings must be held and properly recorded.
  • Corporations must register for a Tennessee business tax license with the Department of Revenue if they engage in taxable activities.

Annual Statements

Apart from national and state banks, all other domestic and foreign corporations in Tennessee must file annual reports with the Secretary of State. The report should be filed by the first day in the fourth month after the end of the corporation's fiscal year.

Franchise and Excise Taxes

In addition to annual reporting, corporations must pay franchise and excise taxes.

  • Franchise Tax: Based on the greater of net worth or property in Tennessee, with a minimum of $100 due annually.
  • Excise Tax: Applied to net earnings at a rate of 6.5%.
    These taxes are separate from federal corporate taxes and apply to both domestic and foreign corporations operating in Tennessee.

Income Tax Rate

Corporations must also pay an excise tax based on the amount of stock. The tax rate is 25 cents per $100, or a major fraction of outstanding and issued capital stock, undivided, or surplus profits shown on the corporation's financial records and books at the end of the previous fiscal year. The minimum tax is $10.

Steps for Filing a Charter

  • Visit Tennessee's Secretary of State website.
  • Select “Corporations” from the drop-down menu of the “Business Services” tab.
  • After selecting the “Corporations” tab, click on “Forms and Fees,” and choose “Charter (ss-4418)” if you want to incorporate a nonprofit entity, or “Charter (ss-4417)” if you want to incorporate a for-profit business.
  • To create a limited liability company, click on the “articles of organization” at the bottom of the page. Once the form comes up, fill according to the requirements.

In Tennessee, a charter includes:

  • The corporation's name
  • The name and address of the registered agent
  • The address of the corporation's registered office
  • The county where the office is located
  • Names and address of incorporators
  • Address of the corporation's principal office
  • A statement of the corporation's purpose, whether nonprofit or for-profit
  • The number of shares being issued

You must also include the filing fee when submitting the charter.

Once the charter is accepted, the corporation legally exists and can commence business operations.

The following requirements are specific to the state of Tennessee:

  • One or more directors is required.
  • A minimum of one officer is required. An individual may hold multiple offices, and one officer must be responsible for maintaining corporate records.
  • Bylaws are required.
  • Annual shareholders meetings are required.

Post-Filing Compliance

Once your charter is approved, additional steps are necessary to stay compliant:

  1. Obtain an EIN (Employer Identification Number): Required for taxes, banking, and hiring employees.
  2. Register with the Tennessee Department of Revenue: For sales tax, business tax, and employer accounts if applicable.
  3. Apply for Local Business Licenses: Many counties and municipalities require separate licenses.
  4. Maintain Corporate Records: Keep bylaws, meeting minutes, and shareholder information updated.
  5. Renew Annually: File your annual report with the Secretary of State and pay applicable franchise/excise taxes.

Frequently Asked Questions

  1. How long does it take to incorporate in Tennessee?
    Processing typically takes 2–4 business days if filed online or by mail. Expedited options may be available.
  2. What is the cost to file Articles of Incorporation in Tennessee?
    The filing fee is $100 plus $0.10 per authorized share (up to $3,000) for for-profits, and $100 flat for nonprofits.
  3. Do Tennessee corporations have to pay both franchise and excise taxes?
    Yes. The franchise tax is based on net worth or property in the state (minimum $100), and excise tax is 6.5% of net earnings.
  4. Are bylaws required for a Tennessee corporation?
    Yes, corporations must adopt bylaws to establish governance, officer roles, and meeting procedures.
  5. Do I need a business license after incorporating in Tennessee?
    Yes. Most corporations must register with the Department of Revenue and obtain a local business license from their county or municipality.

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