Welcome to Part 2 of our compliance series.
Well folks, buckle up—because unlike an LLC, a C-Corp comes with more rules, more filings, and a lot more ways to get in trouble if you slack off. The good news? If you stay on top of it, you’ll enjoy the perks—like easier fundraising, tax strategies, and a legitimate shot at building something big.
But if you ignore compliance? Get ready for:
🚨 Fines, tax penalties, and legal headaches
🚨 Your corporation getting suspended (yes, the state can shut you down)
🚨 Investors running for the hills because your records are a mess
Sound fun? Didn’t think so. Let’s break down exactly what C-Corp owners need to do to stay in the clear. ⬇️
Running a C-Corp? Congrats, You Have More Paperwork!
If you thought keeping an LLC compliant was a chore, welcome to the C-Corp life—where the rules are stricter, the filings are more frequent, and the government watches you like a hawk. But hey, you wanted the tax perks and investor-friendly structure, right?
Here’s what you must keep up with, or risk the state and IRS making your life miserable:
What’s on Your Compliance Calendar?
✅ File Your Annual Report & Franchise Tax – The state wants its cut, and if you don’t pay, they’ll slap you with penalties (or worse, dissolve your corporation). Check your state’s Secretary of State website for deadlines.
✅ Hold Annual Shareholder & Board Meetings – Unlike an LLC, a C-Corp is legally required to hold at least one board meeting a year. Keep meeting minutes on file in case someone questions your leadership (or sues you).
✅ Maintain Corporate Bylaws & Meeting Records – Your bylaws = your company’s rulebook. Keep them updated or risk looking disorganized if you ever face an audit, legal dispute, or investor scrutiny.
✅ File Federal & State Corporate Tax Returns – The IRS loves taxing C-Corps. File Form 1120 every year and pay your corporate tax bill on time—or get ready for interest and penalties. Also, check state-level tax obligations.
✅ Issue Stock & Track Shareholders – If you’ve got investors, you need to document who owns what. Keep a stock ledger to avoid disputes or regulatory headaches.
✅ File Beneficial Ownership Report (BOI) (New for 2024!) – FinCEN now requires C-Corps to report ownership details. Miss the deadline? You could face federal fines.
✅ Keep Business Licenses & Permits Current – Because nothing says "shutdown" like an expired business license. Check local, state, and industry-specific requirements.
Need help? We aren't compliance experts. Make sure you talk to a tax expert if you have any questions about that side of your business. Wondering what the heck the rest of this is? Join our community and jump into office hours to see if we can help!
Disclaimer: We’re not lawyers, accountants, or the compliance police—just business owners who’ve done the research. This guide is for informational purposes only and not legal or financial advice. Always consult a licensed professional to ensure you’re making the right decisions for your business.
Comments