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Dec 8, 2023

How to Get Business Formation Documents for Compliance

Teddy Butz
Marketing

In brief:

  • Business formation documents are legal papers that a business must file with the appropriate government authorities before it can begin legally operating. Another company may be interested in finding them to verify if the business is representing itself truthfully and is safe to do business with.
  • Different types of companies sometimes need different business formation documents. For example, a corporation needs Articles of Incorporation, while an LLC needs Articles of Organization. But most need an Employment Identification Number (EIN) and a Business Name Registration Form.
  • You can usually retrieve a business’s formation documents from a Secretary of State office for the state where the business is registered. Some federal agencies, or the business itself, may also have them. But the most efficient way to get them is by using a dedicated business information retrieval system like Middesk.

In most cases, a business can’t just set up shop and start selling products or services. There are many pieces of legal paperwork that it needs to file beforehand with relevant levels of government for identification, taxation, stock trading, and other purposes. These are collectively known as business formation documents.

Obviously, these documents are important for the business itself. But they can also be important for other companies that want to work with the business, as they can serve as proof that the business is operating legitimately and is safe to deal with.

This article introduces some of the common types of business formation documents. It also outlines how companies pursuing B2B relationships can get formation documents (or at least copies of them) for other businesses, for verification and risk assessment purposes.

So what is a business formation document? And what form(s) can it take for different types of businesses? We’ll start there.

What are business formation documents?

Business formation documents are a set of legal papers that a business must file with an appropriate government agency before it can begin operations. The number and type of documents a business requires can vary depending on its organizational structure.

Types of business formation documents

The specific documents required to form a business can differ depending on a business’s type. For example, the business formation documents needed for an LLC aren’t the same as the business formation documents for a sole proprietorship.

The overall bottom line, though, is that these documents outline essential information about how a business is owned, organized, managed, operated, taxed, etc. So finding copies of them, and ensuring they’re filed with the proper government agency, is a trustworthy way to verify a business is operating honestly. That includes the business having the correct information, as well as being registered with the government in order to operate legally.

Here are some common types of business entity formation documents, and what types of businesses need them.

Employer Identification Number (EIN) 

Required for: Sole Proprietors | Partnerships | Corporations | LLCs

Nearly all businesses in the US require an EIN to operate legally. They must request one from the IRS, both when starting the business and if the business changes its ownership structure. This number is used by the IRS to uniquely identify a business when tracking tax reporting. It is also used in some financial and insurance contexts.

Since all organizations should have an EIN, verifying a company’s EIN number is a great way to validate that they are legitimate.

Business Name Registration Form

Required for: Sole Proprietors | Partnerships | Corporations | LLCs

This form is used to reserve a unique name for a business to run under, in order to avoid consumer confusion regarding similarly-named businesses. In some cases, businesses don’t need a unique name if they are running under the names of their owners. But they still need to legally register a name with the relevant authorities.

This is important from a business verification perspective because it allows another company to know a business’s official name, as well as any “doing business as” (DBA) names it may have. A business registration lookup also ensures that you’re validating the right business name.

Articles of Incorporation

Required for: Corporations

This document outlines the basic information items (“articles”) that constitute the legal formation of a corporation. These typically include the corporation’s name, address, purpose, stock offerings (if applicable), leadership contact information, registered agent contact information, and authorized incorporator contact information.

A corporation can’t legally exist without filing this document with the proper government authorities. Searching for a copy of Articles of Incorporation helps to tell if the business is running legitimately as a corporation.

Articles of Organization

Required for: LLCs

This document is the LLC equivalent of an Articles of Incorporation document for a corporation. It contains much of the same information about an LLC: name, address, purpose, leadership contact information, registered agent contact information, and the filer’s contact information.

Like with Articles of Incorporation, an LLC needs to file Articles of Organization with the appropriate government branch in order to legally exist. So searching for a copy of this document helps to determine whether a business is operating within the law as an LLC.

Corporate Bylaws

Required for: Corporations

Along with Articles of Incorporation, Corporate Bylaws is the other essential document that needs to be filed with the government for a corporation to legally exist. It gives details on how the corporation will run its day-to-day activities, such as leadership positions/responsibilities, leadership election procedures, frequency of meetings, record-keeping procedures, and so on.

Operating Agreement

Required for: LLCs

As corporations have Corporate Bylaws, LLCs have an Operating Agreement. It outlines similar kinds of information: how the LLC will be managed, member/manager responsibilities, procedures for dealing with members/managers joining or leaving, processes for raising additional capital, and so on.

Note that not every US state will require LLCs to file – or even have – an Operating Agreement. But many LLCs will have or file one anyway as a source of truth, in case a complication from an audit or dispute happens down the road.

Shareholder Agreement

Required for: Corporations

If a corporation is going to offer shares in the business for trade, it needs a Shareholder Agreement. This document outlines additional information on the corporation’s ownership setup that isn’t included in the Articles of Incorporation or the Corporate Bylaws. This includes information on dividend issuing; motions that require shareholder approval (and how much); and procedures for handling a shareholder’s stock if they leave the corporation or become incapacitated (through disability or death).

Partnership Agreement

Required for: Partnerships

A Partnership Agreement is a legally-binding document that outlines how a partnership business will be run. Along with who the initial partners are, it should include information on each partner’s responsibilities (including decision-making, profit and loss division, and capital contributions), how the partnership can be ended, how disputes can be resolved, how partners can be added or removed, and how the partnership’s finances will be reported.

A partnership agreement may have a specific name depending on the particular type of partnership being formed. General partnerships need a Statement of Partnership Authority. Limited partnerships, including limited liability limited partnerships, need a Certificate of Limited Partnership. Limited liability partnerships need a Statement of Qualification.

Business License(s)

Required for: Sole Proprietors

Sole proprietorships don’t need most of the other kinds of formation documents listed above. They may, however, need a business license (or several) if they are working in certain regulated industries. For example, a retail store requires a seller’s permit or vendor’s license in order to collect sales tax. A restaurant also needs one of these two licenses, and it needs a food service license in addition because it’s selling food products.

Looking for these licenses allows a company to determine whether a business is properly authorized to operate within a given industry.

Formation documents checklist: what different business types need

To summarize the above information, here’s a chart of what types of businesses need what types of formation documents before they can start.

Checklist for necessary business formation documents for different types of businesses.

How to get business formation documents

In the US, most businesses are registered with state governments (as opposed to federal or county governments). So those are usually the most reliable places to search for a copy of a business formation document for another business. Some may also be found with federal agencies such as the SEC or IRS. It’s also possible to ask a business in question itself for copies of its formation documents.

Here’s a deeper dive into some of a company’s options for how to get business formation documents for another business, in order to evaluate that business’s authenticity and risk profile.

1. Use a solution like Middesk

The best option is to use a dedicated business identity verification and risk assessment platform like Middesk. Through our easy-to-use dashboard or API, Middesk allows you to search Secretary of State offices in all US states and territories – along with several other official sources – simultaneously. This pulls up not only a business’s formation documents, but also many other pieces of information needed to verify a business’s authenticity and evaluate the risk of a B2B relationship with it.

2. Manually check Secretary of State offices

In the US, state governments are usually responsible for the registration of businesses. One of the surest places to find a business’s formation documents is through a Secretary of State office – usually online, but in person if necessary.

There are several drawbacks to this method, though. The root one is there isn’t any tool from the federal government to search all online Secretary of State portals at once. This is a problem because the state in which a business is registered isn’t always the same state where it primarily operates. This means you may have to search several portals one at a time. They each have different interfaces you have to get used to, and may also require signing up for accounts and/or paying fees before allowing you to conduct searches.

3. Search the SEC’s EDGAR System

Corporations that issue their stocks for public trade must register their information with the Securities and Exchange Commission. This information, which may include some types of formation documents, is publicly available from the SEC’s Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system.

The main downside to this method is it only works for corporations that have chosen to publicly issue stocks. So it likely won’t work for other types of businesses. Also note that EDGAR only stores records going as far back as 2001.

4. Ask the business Itself

A final option is to directly contact or visit the business and ask for copies of its formation documents. There are several issues with this method, though. One is that a business may be very suspicious as to why another company would want copies of its formation documents. You may have to make a convincing case that your company will be using these documents for verification purposes only.

The business may not even have copies of the documents on-site because they aren’t required to do so (or at least not at the branch you contact). And even if it does, reluctance to give away copies of important documents may mean the business takes a while to get back to you or follow through on your request.

Find business formation documents the easy way with Middesk

Searching for businesses and their formation documents one-by-one at Secretary of State offices, the SEC/IRS, or branch offices of the businesses themselves is time-consuming and expensive.

The more efficient solution is to use Middesk to query multiple sources for business information at once. This makes it easier to retrieve not only copies of a business’s formation documents, but also other information you’ll need to properly verify a business’s authenticity and develop a risk profile for it.

To see just how Middesk can accelerate your onboarding process for B2B customers, talk to our team.

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