Form a Corporation in Alabama

Everything you need to know about forming a Corporation in Alabama. Filing fees, requirements, timeline, and step-by-step guidance.

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$200
Filing Fee
5-7 business days
Processing Time
$100
Annual Tax
Required
Registered Agent

How to File

1

Choose a Corporate Name

Select a unique name for your corporation that includes a required designator such as 'Corporation,' 'Incorporated,' 'Company,' or an abbreviation thereof. Search the Alabama Secretary of State's business name database to confirm availability before filing.

30 minutes

2

Appoint a Registered Agent

Designate a registered agent with a physical street address in Alabama who will accept legal and official documents on behalf of the corporation. The registered agent can be an individual Alabama resident or a business entity authorized to do business in the state.

15 minutes

3

File Articles of Incorporation

Prepare and file the Articles of Incorporation with the Alabama Secretary of State, which must include the corporate name, number of authorized shares, registered agent information, and incorporator details. Filing can be completed online through the SOS website or by mail with the $200 filing fee.

1-2 hours

4

Pay Alabama Privilege Tax

Pay the initial Alabama Business Privilege Tax, which has a minimum of $100, to the Alabama Department of Revenue as part of the formation process. This tax is based on net worth apportioned to Alabama and must be paid before the corporation can begin transacting business.

30 minutes

What's Next After Filing

Once your Corporation is officially formed, you'll want to complete these important steps:

  • Create Corporate Bylaws and Organizational MinutesDraft corporate bylaws governing the internal operations and structure of the corporation, then hold an organizational meeting of the board of directors to adopt bylaws, elect officers, and issue initial shares of stock. These documents are not filed with the state but must be maintained in the corporation's internal records.
  • Obtain an EIN and Open a Bank AccountApply for a Federal Employer Identification Number (EIN) from the IRS at no cost, which is required for tax purposes, hiring employees, and opening a business bank account. Use the EIN to open a dedicated corporate bank account to maintain separation between personal and business finances.
  • Register for Alabama State Taxes and LicensesRegister with the Alabama Department of Revenue for applicable state taxes, including sales tax, employer withholding, and the annual Business Privilege Tax. Obtain any required local business licenses from the county or municipality where the corporation will operate.

Advantages

  • Limited liability protection shields shareholders' personal assets from corporate debts and legal judgments
  • Ability to raise capital by issuing multiple classes of stock and attracting investors, including venture capital
  • Perpetual existence allows the corporation to continue operating regardless of changes in ownership or the death of shareholders
  • Enhanced credibility and professional image with customers, vendors, and financial institutions compared to unincorporated entities
  • Potential for significant tax advantages through deductible employee benefits, retirement plans, and S-Corp election to avoid double taxation

Considerations

  • Subject to potential double taxation at the federal level — the corporation pays corporate income tax and shareholders pay personal income tax on dividends
  • More complex and costly to form and maintain than an LLC or sole proprietorship, with stricter recordkeeping, bylaws, and meeting requirements
  • Required to pay Alabama Business Privilege Tax annually based on net worth, adding an ongoing tax burden beyond standard income taxes

Annual Obligations

Franchise Tax:$100
Annual Report Fee:$0*
Report Due:March 15
* Alabama requires corporations to file an Annual Report combined with the Business Privilege Tax Return (Form BPT-IN for initial, Form BPT-V for annual). The minimum privilege tax is $100, but the actual amount is calculated based on the corporation's net worth apportioned to Alabama at a rate of $1.75 per $1,000 of net worth. The combined annual report and privilege tax return is due by March 15 each year for calendar-year corporations. Alabama does not charge a separate annual report filing fee apart from the privilege tax itself.
Last verified: July 2026Source

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