What are the advantages of incorporating in Texas rather than in Nevada.?
Answer:
Best to Incorporate in Delaware?
Delaware’s advantages as a place of incorporation range from the Delaware General Corporation Law to the flexibility built into the corporate formation process.
Delaware’s large body of business laws helps a company plan carefully to avoid a lawsuit.
Delaware’s Chancery Court oversees matters involving Delaware’s General Corporate Law and has a reputation as one of the finest courts in the country.
Chancery Court issues decisions without jury trials, so their decisions are written, well thought-out and easy to follow.
Legal textbooks rely heavily upon Delaware corporate case law to teach law students because of the well written opinions from the Delaware Judiciary, so most American corporate attorneys have studied Delaware corporate law.
The Delaware Division of Corporations generates a considerable amount of revenue for the State, so they have invested in state-of-the-art imaging equipment, and process new filings very quickly.
A handful of Delaware registered agents, including Delaware Intercorp, have direct connections to the Division of Corporation’s electronic database, and can file your corporation formation documents electronically.
Why not incorporate in Delaware - no state taxes at all, you can do it all by mail and the other poster linked you to a third party site when all the info you need is right here:
http://www.state.de.us/corp/default.shtm.
Incorporating in Texas: The benefits Texas incorporating allow business owners to separate their liability for corporate debts from themselves personally. The corporation is responsible itself for debts and protects the officer’s, director’s and shareholder’s personal assets. Corporations must maintain a few operating formalities in order to be viewed as a separate legal entity in the eyes of a court, creditor or attorney. Commingling funds is an example of one of these formalities, it is critical to pay corporate expenses with corporate money, and in the event that personal funds were used for corporate expenses, the corporation should reimburse that money. The corporation must be established and operated properly to reap the full benefits of Texas incorporation.
Texas incorporating allows a business to perpetuate, after certain events, which would make a sole proprietor or partnership unrecognized. Incorporating in Texas means that a separate legal entity is created and as long as the entity is operated correctly, it will continue to exist. This means the Texas corporation must perform a few minor formalities, that include fling an annual statement of information, maintaining a registered agent and keeping annual meeting minutes of the shareholders. Companies Incorporated specialists are available for a FREE consultation during normal business hours, Pacific Time
Navada Incorporated Benafits:
No Corporate Income Tax
No Taxes on Corporate Shares
No Franchise Tax
No Personal Income Tax
No I.R.S. Information Sharing Agreement
Nominal Annual Fees
Minimal Reporting and Disclosure Requirements
Stockholders are not Public Record
Texas does not collect personal or corporate income tax. However, a corporation franchise tax is computed on both taxable capital and a taxable earned surplus basis. A corporation pays on the basis that produces the greater tax. For information on the Texas state taxes, including sales tax, visit: http://www.window.state.tx.us/m23taxes.h.
Disadvantage: No S Corporations. An S-corporation is a corporation that elects to be treated as a pass-through entity (such as a sole proprietorship or partnership) for tax purposes. Since Texas does not have a state income tax, a subchapter-S election thus has federal, but no state, implications for Texas corporations.
NEVADA: Benefits of incorporation in Nevada may be substantial for your business if located in another state although your home state's fees and documents may still be required. Whether you incorporate in your home state or Nevada your corporate designation helps protect your personal assets while increasing your company's credibility. Incorporation creates your business as a legal entity separate from yourself, meaning your home, cars and personal savings are safe. Whether or not you live and operate in the state of Nevada, incorporation in Nevada may be a viable option for your business depending on your situation and goals. Advantages of Incorporating in Nevada:
* No corporate income tax in Nevada.
* No taxes on corporate shares.
* No franchise tax in Nevada, unlike Delaware.
* No personal income tax.
* No I.R.S. Information Sharing Agreement.
* Nominal annual fees.
* Minimal reporting and disclosure requirements.
* Stockholders are not public record, and directors need not be stockholders.
* Stockholders, directors and officers need not live or hold meetings in Nevada, or even be U.S. Citizens.
* Officers and directors of a Nevada corporation can be protected from personal liability for lawful acts of the corporation.
Many companies conduct business throughout the U.S. and abroad. A corporation having business locations in multiple states may form a corporation or Limited Liability Company (LLC) in a single state, then "qualifies to do business" in other states. This means companies must formally register, file annual reports and pay annual fees to obtain authority to conduct business in those states; and benefit from the laws of the state. It's usually best to incorporate or form a limited liability company in your home state however, an entity may elect to incorporate outside the state in which the corporation conducts a majority of its business and choose to incorporate in any of the 50 states or the District of Columbia.
Advantages:
* Typically the least complicated if you only plan to operate the business in your home state.
* Avoid paying franchise taxes and filing annual reports in more than one state.
* Usually costs less to incorporate locally.
Disadvantages:
* May miss out of the advantages of forming a corporation or LLC in Delaware or Nevada.
The Limited Liability Company (LLC) is a type of hybrid business structure that is designed to provide the limited liability features of a corporation and the tax efficiencies and operational flexibility of a partnership. A popular choice for sole proprietors who are looking to incorporate simply to protect personal assets or secure additional loans and is one of the easiest and least expensive forms of ownership to organize. LLC's are a recognized business structure in all 50 states plus the District of Columbia and are gaining popularity with small business owners because they combine the advantages of a corporation with the tax advantages and management flexibility of a partnership
Advantages:
* Owners of an LLC have limited liability for business debts.
* For tax purposes the allocation of profit and loss of an LLC need not be proportional to ownership interests. A BIG PLUS.
* With an LLC, there is no double taxation threat since the LLC is not a separate taxable entity.
* You do not need to be a US citizen to own or invest in an LLC.
I would say demographics of texas is one advantage compared to Nevada which seems to me to be more isolated.
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