Forming an Alabama corporation requires five steps: reserve your name ($28 online), file a Certificate of Incorporation with the Alabama Secretary of State ($208 online), appoint a registered agent, adopt bylaws and hold an organizational meeting, then file your federal BOI Report within 90 days. Alabama's most notable rule: all corporate directors must be at least 19 years old — one year older than most other states require.
Corporation vs LLC — which is right for your Alabama business?
Before forming a corporation, it's worth confirming it's the right structure. Most Alabama small businesses use an LLC because it's simpler, more flexible, and has lower ongoing compliance requirements. Corporations make the most sense in specific situations:
- You plan to raise outside investment — investors expect equity in a corporation (typically a C Corp), not an LLC membership interest
- You want to issue stock to employees — stock option plans and equity compensation are built for corporations
- You're planning an IPO — public companies are corporations
- You want S Corp tax treatment from the start — while LLCs can elect S Corp taxation, forming a corporation and immediately filing Form 2553 is the cleaner path for some businesses
- Your industry expects or requires corporate structure — certain professional services, contractors, and larger businesses operate as corporations by convention or requirement
If none of these apply, an Alabama LLC is almost always the simpler choice. If you're still deciding, our sole proprietorship vs LLC guide covers the full comparison.
Alabama corporation requirements — what's unique
Alabama's director age requirement: Under Ala. Code § 10A-2A-8.02, every director of an Alabama corporation must be at least 19 years old. Most states require directors to be 18. This is the most commonly overlooked Alabama-specific rule — appointing a director under 19 is a defect in your corporate structure that can cause legal problems later.
| Formation document | Certificate of Incorporation |
| Filed with | Alabama Secretary of State |
| Online filing fee | $208 |
| Mail filing fee | $200 |
| Name reservation required? | Yes — before filing ($28 online) |
| Minimum directors | 1 (must be 19+) |
| Minimum officers | President, Secretary, Treasurer |
| Annual report required? | No — eliminated under Act 2024-213 |
| Annual tax filing | Form CPT (Business Privilege Tax) by April 15 |
| Minimum privilege tax | $100 (corporations do not have the $100-or-less exemption that LLCs have) |
| BOI Report required? | Yes — within 90 days of formation |
| Registered agent required? | Yes — Alabama physical address |
Step-by-step: how to form an Alabama corporation
Choose and reserve your corporate name
Your corporation's name must include "Corporation," "Corp.," "Incorporated," or "Inc." It must be distinguishable from all other Alabama-registered businesses. Search the SOS entity database at arc-sos.state.al.us, then file a Name Reservation ($28 online, $25 by mail) — required before you can file the Certificate of Incorporation. The reservation holds the name for 120 days.
Appoint a registered agent
Every Alabama corporation must maintain a registered agent with a physical Alabama street address (no P.O. boxes). The agent receives service of process and official state correspondence. You can appoint an individual Alabama resident or a registered agent service. See our Alabama registered agent guide for options starting at $49/year.
File the Certificate of Incorporation
File at sos.alabama.gov ($208 online) or by mail ($200) with your Name Reservation Certificate attached. Your Certificate of Incorporation must include: the corporation's name, the number of authorized shares of stock, the registered agent's name and address, the incorporator's name and address, and the purpose of the corporation (a general purpose statement is acceptable). Online processing takes 5–7 business days.
Appoint directors (must be 19+) and adopt bylaws
After formation, the incorporator appoints the initial board of directors. All directors must be at least 19 years old under Ala. Code § 10A-2A-8.02. The board then holds an organizational meeting to: adopt corporate bylaws, appoint officers (President, Secretary, Treasurer at minimum), authorize the issuance of shares, open a bank account, and handle other initial business. Document everything with written minutes — this paper trail is what makes the corporate liability shield legally defensible.
Issue stock to shareholders
Authorize and issue shares of stock to the initial shareholders as agreed. Even a simple two-founder corporation should document share issuance in writing with a stock ledger and stock certificates (physical or electronic). The number of shares issued cannot exceed the number authorized in the Certificate of Incorporation.
Get an EIN and open a business bank account
Apply for a federal Employer Identification Number (EIN) at IRS.gov — free, instant online. You'll need this to open a corporate bank account, hire employees, and file tax returns. Bring your EIN confirmation, Certificate of Incorporation, and corporate resolution authorizing the account to the bank.
File the BOI Report with FinCEN
Within 90 days of formation, file a Beneficial Ownership Information (BOI) Report with FinCEN at fincen.gov. This is a federal requirement under the Corporate Transparency Act — free to file, $500/day penalty for willful non-compliance. Report each beneficial owner (25%+ shareholders and anyone with substantial control). See our full BOI Report guide.
Obtain licenses and file your initial Business Privilege Tax return
File Form CPT (Corporate Privilege Tax) with the Alabama Department of Revenue — due by April 15 of the year following formation. Unlike LLCs, corporations do not have a $100-or-less exemption; the minimum tax is $100. Also obtain any required business licenses at the state and county level. See our Alabama business license guide.
Consider S Corp election if applicable
If you want S Corporation tax treatment — passing corporate income through to shareholders to avoid double taxation — file IRS Form 2553 within 75 days of formation (or by March 15 of the year you want the election to apply). Alabama follows federal S Corp classification and does not require a separate state form. See our full S Corp Alabama guide.
C Corp vs S Corp — Alabama tax treatment
When you form a corporation, it is automatically a C Corporation for tax purposes. C Corps pay corporate income tax at the entity level, and shareholders pay personal income tax again on dividends — the "double taxation" problem. Most small Alabama businesses that choose the corporate structure elect S Corporation status to avoid this.
| Feature | C Corporation | S Corporation |
|---|---|---|
| Tax treatment | Corporate income tax + dividend tax | Pass-through — income taxed on shareholders' returns only |
| Maximum shareholders | Unlimited | 100 shareholders maximum |
| Shareholder eligibility | Anyone, including other corporations and non-US persons | US citizens and residents only — no corporate shareholders |
| Stock classes | Multiple classes allowed | One class of stock only |
| Best for | Businesses seeking outside investment, venture capital, or eventual IPO | Small businesses wanting liability protection with pass-through taxation |
| IRS election required? | No — default status | Yes — Form 2553 within 75 days of formation |
Most small Alabama corporations elect S Corp status. If you're forming a corporation primarily for liability protection and tax efficiency (not to raise venture capital), filing Form 2553 shortly after formation avoids double taxation while keeping the corporate structure. Many accountants recommend this as the default for small, owner-operated Alabama corporations.
Ongoing compliance requirements
Alabama corporations no longer file annual reports — this requirement was eliminated under Act 2024-213, effective October 1, 2024. Ongoing compliance consists of:
- Form CPT (Corporate Privilege Tax) — filed annually with the Alabama Department of Revenue by April 15. Minimum tax is $100.
- Maintain a registered agent — must be current at all times. Update the SOS if your registered agent changes.
- Annual shareholder and director meetings — required by Alabama corporate law; document with written minutes even if informal.
- Update BOI Report within 30 days of any change to beneficial ownership information.
- Renew business licenses — Alabama state privilege license and any county or city licenses renew October 31 each year.
Frequently asked questions
Related guides
- How to form an LLC in Alabama (simpler for most businesses) →
- S Corp Alabama — tax election and requirements →
- BOI Report Alabama — federal filing requirement →
- Alabama registered agent requirements →
- EIN number for Alabama businesses →
- Alabama Business Privilege Tax →
- Alabama business name search →