Why you should organize your limited liability company in Nevada:

Nevada has been very aggressive in making laws to attract business to Nevada, especially from people in nearby California. Nevada has favorable state income tax rates. Nevada allows for bearer stock certificates where the holder of the certificate is the owner and no stockholder list is required. Nevada has designed its laws to make it very difficult for a creditor of a corporation from suing the stockholders personally. For this reason, Nevada corporations have grown in popularity.

Despite these positive aspects of Nevada's legislation, some business owners find more benefit by forming their companies in Delaware.

Delaware vs. Nevada

Our U.S. and foreign customers often ask about anonymity, confidentiality and privacy with regard to the owners, officers and directors of a corporation or members and managers of an LLC formed in Delaware or Nevada. The following explains how the Delaware LLC provides the most protection at the lowest cost.

It is much touted that the State of Nevada does not charge an income tax to businesses located in Nevada. Nevada allows for stockholders to remain anonymous (bearer stock certificates with no names of stockholders). The only way for officers, directors or members to remain private is to have a director nominee; this service is not ethical in our opinion. Nevada does not have an information sharing arrangement with the IRS (but this is irrelevant if your private information is published with the initial list of officers and directors). If you are located outside of Nevada, such as in California, you will pay California income tax and will probably have to register your Nevada Company as an out of state company doing business in California and pay the annual fee to California ($800 per year).

While Delaware does not have such a non-information sharing arrangement with the IRS, for most companies, that is not relevant because the State of Delaware does not obtain any financial or personal information about your company. Delaware companies also have a better reputation in the business community, as judged by the United States Chamber of Commerce.

　　　　　　　　　　　　　　 >>　1　 2 <<