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Why Start an IA Corporation?

The state of Iowa has a lot to offer. From loans and development programs to business tax incentives, corporations have several options to choose from. Your corporation may be able to take advantage of these incentives, provided it meets qualifying criteria.

For example, the Economic Development Set-Aside (EDSA) program provides financial assistance to businesses and industries requiring assistance to create or retain job opportunities in Iowa. EDSA develops viable communities that provide economic opportunities for people, especially those with low- and moderate incomes.

For many entrepreneurs looking to start a larger business, an IA corporation may be the best choice. As a corporation, your business is able to buy and trade stock, and when it comes to excess profits, corporations offer more flexibility than a limited liability company (LLC). A corporation is allowed to pass income and losses to its shareholders, who report taxes on an individual tax return at ordinary levels.

Is an LLC Better Than a Corporation?

It all depends on your goals. For smaller businesses, limited liability companies are generally a better option. LLCs are easier to set up and receive many of the same benefits as corporations, but with less regulation.

Learn more about forming a Iowa LLC so you can decide which business entity is right for you.

Benefits of Forming an Iowa C Corporation

  • The strongest form of liability protection possible by insulating your personal assets and finances from business debts, obligations, damages, bankruptcy or other liabilities
  • Several options to create, buy, sell or transfer stock, including publicly
  • The ability to issue more than one class of stock
  • The ability to sell stock to investors inside and outside the U.S.
  • The ability to raise more funds by issuing more stock

Benefits of Forming an Iowa S Corporation

It offers several advantages similar to those provided by a C Corp including, but not limited to:

  • Options for creating, transferring and selling stock, though not as many as a C Corp
  • The capacity for up to 100 shareholders
  • Simpler rules than those applicable to C Corporations
  • Easy transfer of ownership simply by selling your stock
  • The possibility of saving money by allowing you to pay less self-employment tax

In this guide, you’ll find information on naming your corporation, getting a Registered Agent, the fees you’ll need to pay, business taxes and much more. We also cover what you'll need to register your corporation and how you'll interact with the Secretary of State in Iowa.

Start a Business in Iowa Checklist

To help you along the way, use our Starting a Business checklist to keep track of everything you need to do to get your business up and running.

 

How to Form an IA Corporation Yourself in 6 Steps

1

Choose a Unique Business Name and Complete a State Business Search

Every Iowa corporation must have a unique name that isn't already being used by another business in the state. If you’re having difficulty deciding on a name, try using our Business Name Generator to gather ideas. You'll need to follow a few naming rules, which you can read about in detail on the Iowa Corporation Names page.

Once you’ve landed on a name, you’ll need to make sure it’s available in Iowa. To see whether another company in the state is using your desired business name, use our tool to do a Iowa entity search. You can also carry out a name search on the state's website.

We can check Iowa corporation name availability for you

2

Provide an Official Address for Your Corporation

All Iowa corporations must have a designated address. This address could be your home address (if you’re running your company from home), a building where your office is located or any physical address of your choice. The address can be outside the state of Iowa and can be a P.O. Box.

You may also be able to use a virtual mailbox for your business address. Incfile can provide you with an Iowa virtual mailbox where we'll receive your mail, scan and upload it for your online review. This can be especially helpful if you run a home-based business and don't want your home address published as part of your business public record.

3

Assign a Registered Agent

Someone who receives official correspondence and is responsible for filing reports with the Iowa Secretary of State is known as a Registered Agent. Every Iowa corporation is required to have a Registered Agent.

You may fill this position yourself, assign another manager in your business or use a Registered Agent service. If your Registered Agent in Iowa is a person, they must have a physical street address in Iowa and must be available during business hours to receive important documents on behalf of your company. You'll appoint your Registered Agent when you file your Articles of Incorporation with the Secretary of State and formally create your corporation.

All of Incfile’s business formation packages include Registered Agent service. It’s free for the first year and just $119 per year after that. You can also access a digital dashboard to view any document we've received on your behalf.

4

File Your Articles of Incorporation with the Iowa Secretary of State

Once you've gathered all the information for your corporation, you’ll need to file your Articles of Incorporation with the Secretary of State. To do this, the Iowa SOS has request that new business filings be completed using their Fast Track Filing service. Once you've filed you will have officially created your business.

Here’s what is typically included in the Articles of Incorporation:

  • Your corporation's name
  • The corporation’s capital structure (number of shares to be issued)
  • Registered Agent's name and address
  • Name and address of each incorporator
  • The filer's name and address

Your Articles of Incorporation should be filed online via the state's digital portal. You can complete this yourself, or Incfile can file it on your behalf. The IA Corporation filing fee is $50.

You only need to file your Articles of Incorporation in Iowa once, but once every odd-numbered year, you'll also need to file a biennial report with the Secretary of State in IA. You'll do this via the Fast Track Filing system provided by the Secretary of State. Incfile can remind you about this every two years, or we can do it for you if you have us handle the paperwork.

Let Incfile Handle All the IA Incorporation Paperwork for You for $0 + the State Fee

What are the fees and requirements to incorporate in Iowa?

State Fee State Filing Time Expedited Filing Time
$50 3 Weeks 3 Business Days
State Fee $50
State Filing Time 3 Weeks
Expedited Filing Time 3 Business Days

Annual Report

Frequency

Biennially

Due Date

April 1st of odd-numbered years

Filling Fee

$60

5

Get an Employer Identification Number (EIN) from the Internal Revenue Service

You'll need an EIN to identify your business to the IRS. You use this number for filing and paying taxes, submitting payroll information and payments for your employees and opening a business bank account. You can obtain one directly from the IRS, or Incfile can get one for you as part of the IA corporation creation process.

6

Write Bylaws

A set of rules that govern how a corporation will be run, bylaws detail how many directors the corporation will have, whether the board of directors will have annual meetings and what the voting requirements will be, among other things.

Some states legally require companies to create bylaws, and the state of Iowa is one of them. You don't need to file your bylaws with the Secretary of State; simply keep them with your other business records.

It's always a good idea to write and follow bylaws to protect your business from any future changes and events.

Types of IA Corporations

C Corporation

When you file to start a corporation, by default, it's a C Corp. This is the choice for large businesses that will trade shares in the stock market.

A Iowa C Corporation will offer you several liability protections, but it will also be required to adhere to numerous strict rules and regulations. It will also likely have a substantial amount of administrative overhead, and won't enjoy as many tax advantages as other corporation types.

Learn more about C Corporations.

S Corporation

Technically, an S Corporation isn't a business entity the way LLCs and C Corporations are. It's a tax filing status. An LLC or a C Corporation can be an S Corporation. It's just a matter of filing a form with the IRS.

The main reason to file as an S Corp is to save money on self-employment taxes. To get an idea of how much money you might save, use our S Corp Tax Calculator.

If you want your Iowa C Corporation to be treated as a Iowa S Corporation, file the IRS Election by a Small Business Corporation form, also known as Form 2553 or an S Corp Election form. Consult with your accountant or tax advisor to determine whether this is your best option.

Learn more about S Corporations.

Compare S Corp vs. C Corp to learn the benefits and drawbacks of both, and decide which one will best suit your needs.

Professional Corporation

Some states, including Iowa, allow certain occupations to form Professional Corporations. Iowa Code Title 12, Chapter 496C, § 496C.2 defines a Professional Corporation in Iowa as: "...a corporation subject to this chapter."

Title 12, Chapter 496C, § 496C.2 also lists a few of the professions permitted to form a Professional Corporation in Iowa, which include, but may not be limited to:

  • Certified public accountancy.
  • Architecture
  • Chiropractic
  • Dentistry
  • Physical therapy
  • Practice as a physician assistant
  • Psychology
  • Marital and family therapy or mental health counseling, provided that the marital and family therapist or mental health counselor is licensed under chapters 147 and 154D
  • Social work, provided that the social worker is licensed pursuant to chapter 147 and section 154C.3, subsection 1, paragraph “c”
  • Professional engineering
  • Land surveying
  • Landscape architecture
  • Law
  • Medicine and surgery
  • Optometry
  • Osteopathic medicine and surgery
  • Accounting practitioner
  • Podiatry
  • Real estate brokerage
  • Speech pathology
  • Audiology
  • Veterinary medicine
  • Pharmacy
  • The practice of nursing

Show all

Check with the Secretary of State to confirm whether your business should and can be a Professional Corporation.

Foreign Corporation

If your business operates in another state and you want to expand into Iowa — or vice versa — you’ll need to form a Foreign Corporation.

Learn more about Iowa Foreign Corporation registration.

Nonprofit Corporation

Charitable organizations can incorporate as nonprofit corporations. This means all the profits they generate are donated to the organization supported by the charity, minus administrative costs.

A nonprofit corporation is also exempt from federal and state taxes, allowing more of the profit to benefit the charity.

Note: Everything in this guide applies to for-profit corporations, and mostly to C Corps and S Corps. Items listed as requirements for forming a corporation may or may not also apply to nonprofits.

Limited Liability Company

Depending on the type of business you want to start, or your personal circumstances and goals, an LLC may be a better option. For example, if you only want to build a small business that you yourself will run with just a few employees and you may not need the options to buy and sell stock.

An Iowa LLC is often a better option for a smaller business. It's easier to set up, but it still offers you certain advantages you'd get from a corporation. You can even have your LLC treated as an S Corporation for tax purposes to save you money.

Regardless of which way you decide to go, we can help you with your Iowa business registration.

Learn more about limited liability companies.

Sole Proprietorship or Partnership

These are the simplest types of businesses to set up. That's because there's no real setup to do. If you don't choose to form a separate business entity, by default, you'll have either a sole proprietorship (just you) or a partnership (you and one or more other people).

Neither of these options provide you with any special benefits or liability protections and can leave your personal assets vulnerable. For these reasons, we don't recommend them.

Compare business entity types to decide which one is best for you.

Helpful Resources from the State of Iowa

More Information in This Guide

You’ll find plenty more insight and guidance on the other pages of this guide, including:

Iowa Corporation Names

How to search the state business registry and find the right name. Includes information on naming rules, fictitious names, reserving names for IA corporations and more.

Iowa Registered Agents

How to appoint, change and search for Registered Agents. Also includes the duties they fulfill and the rules they’re required to follow.

Iowa Incorporation Fees and Requirements

Details the various fees you’ll need to pay and the state and federal requirements you’ll need to meet. Includes details about Employer Identification Numbers (EINs), state and federal business licenses, biennial reports and more.

Iowa Corporation Taxes

Covers the various taxes you’ll have to pay to the state and federal governments. Includes details about state taxes such as income and sales, and federal taxes such as income and self-employment.

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