Keep this in mind when buying a new or aged corporation or an LLC, you are buying an corporate asset that begins or continues to appreciate the day you start the business. Should you ever consider closing or selling your business, determine the value of the aged corporation in the selling price. Most owners totally forget about the corporate value that can be sold later as long as it has been maintained properly. There are plenty of buyers looking for good aged corporations.
What you get when you purchase an Aged Shelf Corporation?
To create a corporation, articles of incorporation must be filed with the Secretary of State or other appropriate state agency, bylaws and organizing resolutions. A corporation will need to apply for a tax identification number with the IRS.
New or Aged corporations, LLC's include:
1. Articles of Incorporation
2. Corporate By Laws
3. Organization Resolutions
4. IRS Form or Phone Number to file for your business EIN.
5. Custom Stock Certificates
6. Corporate Seal & Stamp
7. Corporate Business Forms. This is not always the case.
8. Corporate binder - This is not always the case.
a. In most cases a nice corporate binder is included to keep your corporate records and documents organized.
What is the Cost to purchase a New Corporation vs. an Aged?
This really depends on the age of the corporation and assets attached to the corporation. If you are starting a new company with all of the above items your cost should be less than a $1000.00. Maintaining your business annually will cost approximately $1000.00. Check with your state & local agencies for accurate rates.
In order to get funding and financing for a new company, you will need to prepare your business from the beginning to build a credit ready business. This takes time... at least 6- 9 months for a new business to start building good solid reporting trade lines. Most banks or lenders will turn you down for for credit until you have a minimum of 2 years history and reporting good credit trade lines with vendors.
What is the cost to Purchase an Aged Corporation?
In order maintain corporations, LLC's in good standing with the Secretary of State and local agencies owners spend an average of approximately $1,000.00 per year to maintain plus the owners time creating the added value for the corporation. Add 20 to 30 % or more depending on other services.
When calculating a sales price:
1. Initial Cost of set up, then Multiply the age of the Corp or LLC X Years = Shelf Company price.
2. Add additional fees for products or services included with the aged shelf corp.
Value goes up based on the work the owners have put into developing the corporation for maintaining history and building credit readiness for the buyer.
Aged Corporations example basic annual cost break down:
Example Owner operates in California using a Delaware Corp.
- Owners Accountants annual filling fee $150 - 250
- Annual fee Delaware registered agent fee $60.00
- Annual fee for California Registered Agent . $ 60.00
- Annual Franchise fee for Delaware is based on a issued share price.
- If filed as a foreign corporation to business in CA.
- Requires Statement of information to be filed 25.00 filed annual.
- Annual Franchise tax annual report minimum is $800.00
Aged Corp's additional fees that increase the value of the purchase price.
- The age of the corporation is number one factor.
- Location of the Corporation - Delaware is number 1 choice for business owners, with Nevada & Wyoming number 2, Aged Corp.
- Checking accounts
- Trade Credit Lines established for the company
- Cash Trade lines for the company
- Dun & Bradtreet Duns Number 75 or Higher with at least 4 trade lines
- Additional Credit reporting agencies.
What are the benefits of purchasing an aged corporation?
- Established history for your business.
- Wish to enhance your corporations' image with age.
- Want to build corporate credit, as it may be easier with age.
- Want to encourage companies to do business with you. Some companies are more willing to do business with an established company vs. a younger company.
- Wish to bid on a contract that requires your corporation to be established for a certain period of time.
- Wish to obtain a bank loan. It may be easier if you can show you have history of being incorporated.
- Would like to obtain corporate credit cards and leases.
Make sure you have the service provider assist you with additional products and services you need otherwise you may be on your own.
Have a Terrific Day & Good Luck with your business new or aged Corporation. Call should you need assistance.
All Rights Reserved - Copyright 2008
Author
Wm Cole Smith
http://www.wmcolesmith.com - http://www.eloc.net -
Service Provider - 949 872 1965
Aged Corporations & Corporate Credit lender - Broker - Entrepreneur/business owner for over 19 years. Formerly Dun & Bradstreet Senior Analyst
Corporate Credit Digital Ebook available - "Keep it Simple" Business Series Digital Ebooks for Entrepreneurs: from starting your business to negotaing skills & mentors. visit eloc's website
ELOC - Equity Lines Of Credit Equity - Corporate Credit , HELOC, Home Equity Line Of Credit, Commercial Equity Line Of Credit. ELOC is affiliated with - ELOC Capital & management Group Corp. Located in Irvine CA.
Established in 1995, incorporated 2002 Wm Cole Smith All Rights Reserved 2008
Article Source: http://EzineArticles.com/?expert=Wm_Cole_Smith
