Business Formation Documents: A Complete Guide for Small Business Owners

Introduction

Key Things to Know

1. 1

   Your choice of business structure (sole proprietorship, partnership, LLC, corporation) determines which formation documents you need and affects taxation, liability, and operational requirements.

2. 2

   MWBEs should prepare additional documentation for certification programs that can provide access to special contracting opportunities and resources.

3. 3

   Formation documents should anticipate future growth and include provisions for adding investors, changing ownership, or expanding operations.

4. 4

   State requirements vary significantly, so research your specific state's filing procedures, fees, and ongoing compliance obligations.

5. 5

   Working with a business attorney to draft or review your formation documents is an investment that can prevent costly legal issues in the future.

6. 6

   Proper formation documents not only establish your business legally but also create the foundation for business relationships, financing opportunities, and eventual business sale or succession.

7. 7

   Keep your formation documents updated as your business grows and changes to ensure they continue to serve your needs and comply with current laws.

Wisconsin Requirements for Business Formation Documents

• Articles of Organization/Incorporation (Wis. Stat. § 183.0202 (LLCs) or Wis. Stat. § 180.0202 (Corporations))

  The primary document filed with the Wisconsin Department of Financial Institutions to legally establish a business entity. Must include the company name, registered agent, business purpose, and management structure.

• Business Name Requirements (Wis. Stat. § 183.0103 (LLCs) or Wis. Stat. § 180.0401 (Corporations))

  Business names must be distinguishable from other registered entities and include appropriate designators (LLC, Inc., etc.). Name reservation is available for 120 days prior to filing formation documents.

• Registered Agent Designation (Wis. Stat. § 183.0105 (LLCs) or Wis. Stat. § 180.0501 (Corporations))

  All Wisconsin business entities must maintain a registered agent with a physical Wisconsin address who can receive legal documents and service of process.

• Operating Agreement/Bylaws (Wis. Stat. § 183.0102(16) (LLCs) or Wis. Stat. § 180.0206 (Corporations))

  Internal governing documents that outline ownership, management structure, voting rights, profit distribution, and operational procedures. While not required to be filed with the state, they are essential internal documents.

• Federal Tax ID (EIN) Requirements (26 U.S.C. § 6109)

  Most businesses must obtain an Employer Identification Number from the IRS for tax filing purposes, opening bank accounts, and hiring employees.

• Wisconsin Business Tax Registration (Wis. Stat. § 73.03(50))

  Businesses must register with the Wisconsin Department of Revenue for state tax purposes, including sales tax collection if selling taxable goods or services.

• Securities Compliance (Wis. Stat. Ch. 551 and Securities Act of 1933 (15 U.S.C. § 77a et seq.))

  When issuing ownership interests or stock, businesses must comply with federal and Wisconsin securities laws, including potential exemptions for small offerings.

• Annual Report Requirements (Wis. Stat. § 183.0120 (LLCs) or Wis. Stat. § 180.1622 (Corporations))

  Wisconsin businesses must file annual reports with the Department of Financial Institutions to maintain active status and update entity information.

• Business Licenses and Permits (Wis. Stat. § 440.03)

  Depending on business activities, various state and local licenses or permits may be required, which should be addressed in formation documents.

• Employment Laws Compliance (Wis. Stat. Ch. 103 and Fair Labor Standards Act (29 U.S.C. § 201 et seq.))

  Formation documents should address compliance with Wisconsin and federal employment laws if the business will have employees.

• Benefit Corporation Provisions (Wis. Stat. Ch. 204)

  For businesses seeking benefit corporation status, formation documents must include specific public benefit purposes and reporting requirements.

• Foreign Business Registration (Wis. Stat. § 183.1003 (LLCs) or Wis. Stat. § 180.1503 (Corporations))

  Out-of-state businesses operating in Wisconsin must register as foreign entities and comply with Wisconsin laws in their formation documents.

• Minority/Women-Owned Business Certification (Wis. Stat. § 16.287)

  Formation documents should address eligibility and requirements for minority or women-owned business certification if applicable.

• Business Privacy Policies (Wis. Stat. § 134.98 and various federal laws including GLBA (15 U.S.C. § 6801))

  Formation documents should address data privacy compliance requirements under both Wisconsin and federal law.

• Intellectual Property Protection (15 U.S.C. § 1051 et seq. (Lanham Act) and 17 U.S.C. § 101 et seq. (Copyright Act))

  Formation documents should address ownership and protection of intellectual property, including compliance with federal trademark and copyright laws.

• Business Dissolution Procedures (Wis. Stat. § 183.0901 (LLCs) or Wis. Stat. § 180.1401 (Corporations))

  Formation documents must outline the process for winding up business affairs, distributing assets, and properly dissolving the entity under Wisconsin law.

• Professional Service Business Requirements (Wis. Stat. § 180.1901-1921)

  For professional service businesses (doctors, lawyers, etc.), formation documents must comply with specific Wisconsin requirements for professional entities.

• Anti-Fraud Provisions (Wis. Stat. § 551.501 and Securities Exchange Act of 1934 (15 U.S.C. § 78j(b)))

  Formation documents must comply with federal and state anti-fraud provisions, particularly when soliciting investors or making representations about the business.

• Business Insurance Requirements (Wis. Stat. § 102.28)

  Formation documents should address Wisconsin insurance requirements, including workers' compensation if the business will have employees.

• Environmental Compliance (Wis. Stat. Ch. 285 and various federal environmental laws)

  Businesses in certain industries must address environmental compliance in their formation documents, including permits and regulatory requirements.