How to Start a Corporation in Vermont
Starting a Vermont corporation can be done relatively easily.
You will need to find a registered agent, file the Articles of Incorporation with the Vermont Secretary of State, and hold an organizational meeting where you draft your corporation’s bylaws and appoint its initial directors.
We’ll show you how to start a corporation in Vermont yourself.
Or, simply use a professional service:
Northwest ($29 + state fee)
It's Easy to Incorporate in Vermont
Step 1: Name Your Vermont Corporation
Step 2: Choose a Registered Agent
Step 3: Hold an Organizational Meeting
Step 4: File the Articles of Incorporation
Step 5: Get an EIN
For a look at corporation formation in every state, check out our other How to Start a Corporation guides.
Not sure if a corporation is right for you? Check out our LLC vs. Corporation guide to help you make your decision.
Step 1: Name Your Vermont Corporation
Choosing a business name is the first step in starting a corporation.
1. Vermont naming guidelines:
Your corporation’s name:
- Will not be approved if it contains discriminatory language that an “average person” would find offensive in relation to persons’ races, cultures, places of birth, ages, ancestries, or religions.
- Will not be approved if it contains “indecent language,” including terms that describe sexual or excretory organs or relate to sexual activities.
- Will not be approved if it contains “obscene language,” including words or phrases that the average person would deem offensive, sexual, or outright threatening.
- Must be distinguishable from the names of all domestic and foreign corporations registered to conduct business in the state of Vermont. Names containing the same key words or numerals but in a different order are still considered distinguishable.
- Must include the word “Company, “Incorporated,” “Corporation,” or a suitable abbreviation, such as “Co,” “Inc,” and “Corp,” within its name.
Read the Vermont state statute to learn more about corporation naming rules.
2. Is my corporation name available in Vermont?
Your Vermont corporation name must be unique and distinguishable from other business names in Vermont. Use the Vermont Secretary of State’s Business Search Portal to determine if your desired business name is available.
3. Is the URL available?
Before registering your Vermont corporation, you’ll need to check if a good URL is available for your business name. It’s important to secure your URL right away.
Step 2: Choose a Vermont Registered Agent
You must appoint a Vermont registered agent when registering your corporation with the Vermont Secretary of State.
A registered agent is an individual or entity appointed to receive service of process, government correspondence, and compliance documents on behalf of a business.
Your registered agent can be an individual, business entity, or professional registered agent service. Any member of the corporation or individual can serve as your Vermont registered agent as long as the person:
- is 18 years or older
- has a physical address in the state where business activity is conducted
- is available (in person) during normal business hours
Recommended: Northwest offers one year of free registered agent services with their corporation formation package ($29 + State Fees).
Step 3: Hold an Organizational Meeting
Before you officially file the Articles of Incorporation in Step 4, you will need to hold an organizational meeting to complete the following tasks:
- Fill out and execute the Articles of Incorporation
- Create and approve bylaws
- Select your initial director(s)
- Determine your share structure
- Execute an Incorporator’s Statement
Create and Approve Corporate Bylaws
Bylaws are the rules that determine how your organization will be governed and run. For detailed instructions on creating your bylaws, read our corporate bylaws guide.
Appoint Initial Directors
You must appoint at least one director who will oversee your Vermont corporation until the first shareholder meeting.
A corporate director is in charge of the adoption, amendment, and repeal of operational bylaws as well as the election, supervision, and removal of officers.
After forming the corporation, the incorporator(s) — or initial director(s), if named on the formation documents — should call an organizational meeting. During this initial meeting, either the incorporator(s) will elect the board of directors or the initial director(s) will appoint the officers.
Choose a Share Structure and Strategy
A share of stock is the unit of ownership of a corporation. Each share of stock represents a percentage of ownership of the company. For example, if a corporation issues one share of stock the shareholder (stock owner) would then own 100% of the corporation.
Shares can be structured into classes. Each class, termed a share class, holds different rights and privileges. You can have multiple classes and each class can hold any number of shares.
Authorized Shares: the number of shares the corporation is allowed to issue.
Issued Shares: the total number of shares actually issued to shareholders.
Share Class: a group of shares that has a unique set of rights and privileges.
In Vermont, the Articles of Incorporation allows you to indicate if the corporation will issue more than one authorized share class or series. You must indicate whether the share classes are common or preferred.
Common stock gives its shareholder voting rights whereas preferred stock does not. When it comes to company assets, preferred stockholders are paid before common stockholders.
Create and Execute an Incorporator’s Statement
The incorporator(s) should sign an Incorporator’s Statement with complete names and addresses of each initial director and store it in the corporate records book.
This document names the initial director(s) that will serve until the board of directors is elected during the first shareholder meeting. It should be stored with the rest of your corporate records.
Step 4: File the Vermont Articles of Incorporation
You will need to file the Vermont Articles of Incorporation to set up a corporation in Vermont. You can file it by mail or online with the Vermont Secretary of State. The filing cost is $125.
This document will cover the basics of your corporation, including:
- Corporate name, address, and NAICS code
- Corporate registered agent name and street address
- The number of authorized shares the corporation is allowed to issue
- Incorporator name and address
NOTE: To file a hard copy of the Articles of Incorporation, you must fill out a Form Request with the Vermont Secretary of State.
OPTION 1: File Online With the Vermont Corporations Division
- OR -
OPTION 2: File Form CORP-1(G) by Mail or In Person
Filing Cost: $125
Vermont Secretary of State
128 State St.
Montpelier, VT 05633-1104
Step 5: Get an EIN for Your Vermont Corporation
An Employer Identification Number (EIN) is used by the federal government to identify a business entity. It is essentially a Social Security number for the company. An EIN is needed:
- To open a bank account for the company
- For federal and state tax purposes
- To hire employees
Get an EIN
Option 1: Request an EIN from the IRS
- OR -
Option 2: Apply for an EIN by Mail or Fax
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Fax: (855) 641-6935
Running Your Corporation
It is very important to adhere to the formalities of running a corporation. Read our How to Run a Corporation guide to learn more.
Taxes, Annual Reports, & Licensing
Vermont State Corporation Tax Requirements
Depending on the nature of your business, you may be required to register for one or more forms of state tax:
Vermont Sales Tax
If you’re selling a product, you’ll typically need to register for a seller's permit through Vermont's Department of Taxes website. This allows a business to collect sales tax.
Vermont Employer Taxes
If you hire employees, you will need to register for Vermont employer taxes through Vermont's Department of Taxes website. This includes Employee Withholding Tax, Unemployment Insurance Tax, and Disability Insurance.
Vermont Corporation Licenses and Permits
To operate your corporation in Vermont, you must comply with federal, state, and local government regulations. For example, restaurants likely need health permits, building permits, signage permits, etc.
Learn more in our Vermont Business License guide.
File the Vermont Corporate Annual Report
You must file the Vermont Corporate Annual Report each year within two and a half months after the end of your corporation’s fiscal year. You can file online with the Secretary of State after creating an account and logging in. The filing fee is $45.
Corporate Dissolution & Vermont Good Standing
How to Get a Vermont Certificate of Good Standing
A Certificate of Good Standing verifies that your Vermont corporation was legally formed and has been properly maintained.
You may order a Certificate of Good Standing online with the Vermont Secretary of State by creating an account and logging into the state’s Online Business Service Center. The fee is $25.
Order a Certificate of Good Standing
Request a Certificate Online From the Vermont Business Services Division
How to Dissolve a Corporation in Vermont
If at any point you would like to permanently stop doing business, or close your business, it is important to officially dissolve your corporation. Failure to do so in a timely fashion can result in tax liabilities, penalties, or even legal trouble.
There are five main steps to close your Vermont corporation:
- Stop doing business
- Hold a board meeting, vote on dissolution, and record the meeting in the corporation minutes
- File the Articles of Dissolution with the Vermont Secretary of State
- Close your federal and state business tax accounts with the IRS and Vermont Department of Taxes
- Close your business bank accounts
File Dissolution Documents
You may dissolve your Vermont corporation online by logging into the Secretary of State’s online services website. Once logged in, select “End Your Business” from the menu on the left side of the page and follow the prompts. The fee is $20. Vermont recommends filing online, but if you prefer, you may request a blank Articles of Dissolution form to file by mail.
Is a Corporation Right For You?
An LLC provides limited liability protection without corporate complexity.
Find out if an LLC is the right structure for you.
Steps After Forming a Corporation
After forming a corporation, you’ll want to protect your personal and business assets and build credit.
Taking these steps will set your business up for success:
- Open a Business Bank Account
- Open a Business Credit Card
- Establish and Build Business Credit
- Get Insurance
- Protect Your Corporate Veil
Vermont Corporation FAQ
How much does it cost to start a corporation in Vermont?
It costs $125 to file the Articles of Incorporation with the Vermont Secretary of State’s Corporations Division in order to form your Vermont corporation.
Having said that, you will also have to consider the cost of getting a registered agent — unless you plan to do this yourself.
Generally speaking, most corporations use an attorney or a registered agent service.
See our How Much Does a Registered Agent Cost article for more information.
What is the difference between an LLC and corporation in Vermont?
An LLC tends to be the recommended option for small business owners because it is:
- More flexible when it comes to taxes and management
- More affordable
- Less time-consuming to form
On the other hand, a corporation is better when it comes to attracting private investors and/or venture capitalists.
Check out our Why Investors and Venture Capitalists Like C Corporations article for more information.
How long does it take to set up a corporation in Vermont?
According to the Vermont Secretary of State’s Business Services Division, you will need to wait less than one business day after filing your Articles of Incorporation online for your filing to be processed.
Note: Filings received via mail are processed within 7 to 10 business days. You will need to request a paper form online.
Is it difficult to start a corporation in Vermont?
Starting a corporation in Vermont does not need to be difficult and can be done by following a few steps:
- Choose a business name and find a registered agent service
- File the Articles of Incorporation
- Hold an organizational meeting
Having said that, forming a corporation is generally significantly more time-consuming than forming an LLC or general partnership.
Is it easier to start an LLC than a corporation in Vermont?
It can be easier — since it is less time-consuming and more affordable.
Having said that, it is a lot less difficult to run and maintain an LLC in comparison to a corporation after it has been formed. This is because corporations have to abide by a plethora of procedural requirements in order to operate legitimately (e.g., hold annual shareholder meetings, etc.).
See our LLC vs Corporation comparison for more information.