How to Incorporate in Hawaii (August 2024 Update)

Incorporating a business in Hawaii creates a legal entity that is separate from its owners. An incorporated business can enter into contracts, sue and be sued, and take on debt obligations that its owners are not personally responsible for. Incorporating brings additional credibility, tax advantages, and personal asset protection benefits compared to operating as a sole proprietorship or general partnership. This article provides a step-by-step guide on how to incorporate in Hawaii, including an overview of each major requirement along the way.

Choose a Business Name

The first step when incorporating in Hawaii is to select your corporation’s official business name. You’ll want to check that your desired name is available and complies with Hawaii’s naming guidelines before filing your incorporation paperwork.

Hawaii corporations must have an indicator word like “Corporation,” “Incorporated,” or “Limited” in their business names. You also cannot select a name already in use by another Hawaii company or one that government regulators find too similar to an existing business name. Geographical locations and words like “Partners” cannot be included either without additional approval.

Once you have a business name in mind, search the Hawaii Business Express database to see if that name is already taken. If the name is available, you can reserve it for up to 120 days by filing a simple Application for Reservation of Name with the state’s Department of Commerce and Consumer Affairs. There is a small $10 fee to reserve a business name before incorporating.

Reserving your corporation’s name before incorporating is recommended in case there are any issues to resolve with the name you picked. However, you can also file your incorporation paperwork right away without a reservation if you want to save time. The state will still verify name availability even if you don’t reserve it beforehand.

Appoint a Registered Agent

All Hawaii corporations must designate a registered agent, which is a person or company responsible for receiving important legal documents on behalf of the business. Lawsuits, tax notices, subpoenas, and other essential mail will go to your registered agent.

You can serve as your corporation's registered agent yourself if you want to save money. The downsides are that your personal home address will then be listed on the public record. You also need to be available during business hours to sign for deliveries. Using a registered agent service can be worth the small yearly fee for many business owners. These services protect your privacy and ensure important paperwork gets handled promptly if you become unavailable.

When appointing a registered agent, you’ll need to provide their name and a legitimate Hawaii street address (no P.O. boxes). This information will become a part of the state's public record once your Articles of Incorporation are approved.

File Articles of Incorporation

Filing Articles of Incorporation with the Hawaii Department of Commerce and Consumer Affairs formally registers your corporation with the state. Preparing Articles of Incorporation isn’t difficult, but accuracy is important as any mistakes could lead to processing delays. You’ll need to provide the following basic details:

• The official and complete name of your Hawaii corporation
• Your registered agent’s name and physical Hawaii address
• A Hawaii street address for your business
• The mailing address for your business (can be a P.O. Box)
• The number and type of stock shares your corporation is authorized to issue
• The name(s) and address(es) of your incorporator(s)
• Signature of the incorporator(s)

You can file your Articles of Incorporation electronically on the Hawaii Business Express website, which is recommended for fastest processing. The state filing fee is $50, plus an extra $1 State Archive preservation fee. Standard processing takes 3-5 business days, while expedited filing has a 1-3 day turnaround for an additional $25 rush fee.

Get an Employer ID Number

You’ll need a federal Employer ID Number (EIN) if you plan to hire employees, open business bank accounts, or file any corporate tax returns. An EIN serves as your business's tax ID number with the IRS for situations when using your Social Security Number isn’t appropriate. Applying online at IRS.gov for an EIN is free and only takes a few minutes.

Hold an Organizational Meeting

After the state approves your Articles of Incorporation, the next step is to hold an initial organizational meeting. At this first corporate meeting, you’ll adopt bylaws, appoint directors if you have multiple shareholders, elect officers like the President and Secretary, and authorize issuing stock certificates.

Standard bylaws establish internal operating rules and procedures for how your Hawaii corporation will function. You’ll also want to execute resolutions for banking and other corporate matters requiring documentation that authority has been granted to officers or shareholders.

We recommend working with an incorporation service that provides free templates for bylaws, organizational meeting minutes, banking paperwork, and other essential documents you'll need at this stage.

Open a Business Bank Account

During your organizational meeting or shortly thereafter, you should open a dedicated bank account for your Hawaii corporation. Separating corporate finances from your personal accounts adds an extra layer of protection against potential business debts or lawsuits. The legal doctrine known as “piercing the corporate veil” also becomes more likely if shareholders intermingle assets.

Bring a recently filed Articles of Incorporation, corporate bylaws, and your new EIN when applying for an Employer ID Number (EIN). Some banks may require a corporate resolution to open an account if authority hasn’t yet been expressly given to whoever is signing up for the banking services. An incorporation service can provide a free template resolution granting account opening powers that you can customize with your corporation's details.

For more information, take a look at our article on the key benefits of business checking accounts.

File Annual Report

Hawaii corporations must submit an annual report each year to confirm or update details about the business with regulators. You will not need to file an annual report until the year after incorporating. However, don’t forget this important requirement as failing to file an annual report can lead to involuntary business dissolution.

The annual filing deadline varies based on your incorporation date but falls on the last day of the corresponding quarter. For example, a company incorporated on August 1st would file by September 30th of the following calendar year. You must pay a small fee when submitting the annual report online or by mail. We also recommend authorizing an incorporation service that offers automatic annual report reminders and filing services.

Conclusion

Incorporating in Hawaii involves several key steps, but taking the time upfront to properly set up your corporation positions you for business growth and liability protection benefits down the road. Carefully choose your business name and file the Articles of Incorporation to register with the state. Designate a registered agent, obtain an EIN, and hold an initial organizational meeting to cover additional incorporation formalities. Finally, open a dedicated corporate bank account and remember to file the required annual report each year. Following this Hawaii incorporation guide lays the groundwork for running a successful incorporated business in Hawaii.