The first step is to check with your state's corporate filing office (usually either the Secretary of State or Corporations Commissioner) and federal and state trademark registers to make sure the name you want to use hasn't already been used. File the Articles of Incorporation (also called a Charter, Certificate of Incorporation or Letters Patent).

Fill out a preprinted form (available from commercial publishers or your state's corporate filing office) listing the purpose of your corporation, its principal place of business, and the number and type of shares of stock. You'll file these documents with the appropriate office, along with a registration fee which will usually be between $200 and $1,000 depending on your state. Determine if you want out-of-state, in-state, or foreign incorporation. Most small and medium-sized businesses incorporate in the state where the majority of their business is conducted.

Next, you need to select your Corporation's Name. A corporate name is generally made up of 3 parts: Distinctive Element, Descriptive Element, and a Legal Ending. All corporations must have a distinctive element and a legal ending to their names. Some corporations choose not to have a descriptive element. In the name "Cottonwood Furniture Inc." the word "Cottonwood" is the distinctive element; the word "Furniture" is the descriptive element; and the "Inc." is the legal ending. The legal ending indicates that it is a legal corporation and not just a business registration or partnership. You can choose from the following words: Limited, Incorporated, and Corporation or their respective abbreviations: Ltd., Inc, and Corp.

You can contact the Secretary of State's office to obtain the forms and get help with filing an application for registration of the name under which you wish to incorporate your business. After you file, the office will let you know if the name has been taken.

Prepare articles of incorporation for your business following instructions from the Secretary of State's office. The office will send you a certificate of incorporation, which will include the name of the company, the purpose for which it is being formed, the location of the company, and other basic information. You and all required individuals must sign the certificate. The number of legally qualified individuals required to sign varies from state to state.

Enter into a preincorporation agreement with the co-founders of the business, establishing who will serve on the first board of directors, who will buy stock, how many shares and at what price. You might also need to complete (but not file) Corporate Bylaws. These will outline a number of important corporate housekeeping details such as when annual shareholder meetings will be held, who can vote and the manner in which shareholders will be notified if there is need for any additional meetings.

Adopt corporate bylaws and hold a meeting to elect a board of directors. Send an agenda to shareholders before the meeting to let them know what issues (and board candidates) they will be voting on. Once the board is formally elected, any documents created in connection with the preincorporation agreement need to be adopted.