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Where To Incorporate?

 
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Category : > Corporation
Posted On : Tue Sep 01st,2009

 
Where to incorporate my business?
 

Which is the best state to register a business?

First considerations after a new business decides to incorporate is where to incorporate. For most businesses, incorporate in the state where the corporation will do most of its business. This rule holds especially true for smaller businesses that will likely not expand significantly, or that do not want to conducting business outside of their home state. So, incorporating in your business's home state is usually the safest to start your new business. Then if, after your corporation has been up and running for some time, it appears that you may need to conduct business in another state, you can always register in another state as a foreign corporation also known as "Foreign Entity"

Each state has its own legal requirements and registration procedures for new businesses wishing to incorporate. Certain states are well known as favorable homes for corporations or forming an LLC, due to their unique incorporation laws and favorable tax policies.

Most popular states to incorporate your business are:

Note: You cannot register your business other than your home state to avoid paying taxes.

  


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Comments (6)
Rafael Delgado   wrote on : Mon Feb 22nd,2010
Hi, I'm trying to start a business my question is Can I start a business in my home state and work and another state? Where can i research that. THANK YOU.
Reply : infotaxsquare.com
 
Dear Rafael Delgado: Thanks for choosing InfoTaxSquare.com for your business needs. Please use the following link for your answer.

http://www.infotaxsquare.com/view_article.php?id=225


InfoTaxSquare.com
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ivory Dandi   wrote on : Wed May 05th,2010
Can an online Retailer Incorporate anywhere?
Reply : infotaxsquare.com
 

Answer is NO; incorporate structure should be based on shipping. For example if you have go-down and shipping goods to your customers from the State of Alaska then you must incorporate in the state of Alaska.

Why people incorporate other than there Home State?

It may be a right approach in some cases but not all. Like in certain states personal information are not available for general public. It gives you identity protection and secondly is flexible for non

USA residents who are operating businesses from their vicinity. So, we suggest you to consider all phases before deciding incorporating your business other than home state. It may or may not be a good idea depends on your approach.

Conclusion:

Technically it may not be productive or a right approach for small businesses to incorporate outside of their home state as even small businesses are usually required to:
 

pay corporate taxes in both the state of foreign operation and the state of incorporation.

You will pay and file annual or Franchise Tax Reports with both states

Unnecessary registered agent fees every year to maintain business in good standing

 

Complying laws for both states and you have to realize that the tax structure is being complicated every day. If you have pass-through entities like LLC (Limited Liability Company) or an S-corporation you are required to pay taxes on personal level and you will pay taxes based on your residency and it will make your yearly filing more complicated. Filing state non-resident and resident state returns. Most professionals advised to keep more controlled in your business

“incorporate where you are physically located or conducting business”.



Marry Jaleo   wrote on : Wed May 05th,2010
Is it possible for a foreign entrepreneur to invest in an existing online business in the US and become a part owner of it?
Reply : infotaxsquare.com
 

Yes a foreign entrepreneur can become a part of USA based company either as an officer/member or just an investor. If he participates as an officer or a member of USA company then he will have to  comply all corporate laws and if he is just an investor then he will just received his dividends based on the company activities.



Nannei Tanson   wrote on : Wed May 05th,2010
What are the pros and cons of re-incorporating under a different/new name, tax ID etc?
Reply : infotaxsquare.com
 

A pro as making a fresh start/clean break/clean new books? A con as losing the good credit history built up? Other considerations? Overall bad or good idea?  From tax perspective maybe?

 

  1. If trying to avoid tax liabilities then it is a bad idea
  2. If you owe  p.roll or sales taxes to the departments then new licenses will not be issued until pay all prior dues.
  3. With a new start will lose all credibility
  4. Bottom line it all depends what you want to achieve by creating a new entity instead of using existing.


Nicole Brown   wrote on : Wed May 05th,2010
Opening a small business (food store) what I should do first I need help with business plan where to register?
Reply : infotaxsquare.com
 
  • Decide the best structure for your business like Corporation, Limited Liability company or sole proprietor
  • What licenses you may need?
  • Do you to have to buy workers compensation for your employees?

It is highly recommended to retain a professional to guide you step-by-step



ATD   wrote on : Fri Aug 24th,2012
I am a US Citizen, now currently in India and likely to be here for several years. I would like to open an LLC in my former home state of Maryland in the US (I will likely be the only employee as a consultant), and provide my consulting services in the telecommunications area to US companies. Following are my questions: 1) Can opening an LLC in US be done, without me having a permanent address in the US and myself working from India to US companies 2) If so, what are the general tax implications? I assume that I will have to pay US taxes, including SS matching for myself. What is the approximate tax %? I assume that I will not get any typical tax benefits of a US resident LLC 3) I will be charging customers typical US labor rate and getting paid in dollars Thanks!
Reply : infotaxsquare.com
 

Dear ATD:

Thanks for choosing InfoTaxSquare.com for your business needs. You can use the following link for most of your questions and if still need any assistance please call us at 1+516.822.3100.00 to Register LLC in Mariland.

http://www.infotaxsquare.com/e-book/

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