Where to incorporate

Nevada, Delaware and Wyoming are all typically referred to as “corporate havens” and are all popular jurisdictions to incorporate your business. Even Florida is an up and coming jurisdiction! Wherever you chooise to incorporate, be aware of the significant differences between each state.

INCORPORATION IN NEVADA:
We generally recommend Nevada as the #1 incorporation state. Nevada law protects directors and officers from personal liability for acts committed on behalf of the corporation or by the corporation. Because jurisdiction for the corporation is in the state in which it is incorporated, this new law makes Nevada the preferred state in which to incorporate. Nevada has the most favorable tested corporate laws in the United States. It has the highest degree of privacy, and Nevada is the only state in the U.S. that does not share information with the Internal Revenue Service, not to mention no state taxes! Take a look at the following list and see why many people prefer to incorporate in Nevada:

No Corporate Income Tax

No Taxes on Corporate Shares

No Franchise Tax or Gift Tax

No Business and Occupation Tax

No Stock Transfer Tax

No State Personal Income Tax

No I.R.S. Information Sharing Agreement

Minimal Reporting and Disclosure Requirements

Stockholders are not a matter of Public Record

Law requires only one director (you can have a corporation with only one person involved)

Directors can change bylaws

No minimum capital is required

Only officers, directors, and resident agents are disclosed

In Nevada, you do not have to reveal the stockholders of a corporation. The only thing revealed is the identity of the officers. If you have nominee officers for your corporation, your name is not revealed. You, therefore, have privacy. No one knows who owns your corporation. If done properly, this can be a very valuable strategy for protecting assets.

Nevada Corporations have proven effective over time by thousands of clients from literally every state in the nation and around the world.

If price is your only consideration, you may wish to consider Wyoming as it is approximately 35% less to incorporate in than Nevada. Additionally, Nevada recently instituted a business license requirement which is $100 per year in addition to other state fees.

Cons: Nevada has a budget surplus and doesn't need to raise any taxes, however this isn't stopping special interests and unions for public employees and education special interests from pushing the Nevada legislature very hard to create massive crushing unbearable taxes on all business entities in Nevada. It is not unconceivable that in a few years, they may succeed and at that point for many the expense of incorporating in Nevada may outweigh the benefit. Wyoming is very intelligent in this regard and not considering any new taxes on business entities.

INCORPORATION IN WYOMING:
Wyoming is up and coming in the way of attracting new businesses to their state, but they do not have as strong of verbiage in their statutes nor as much established case law as Nevada has. Wyoming's advantages are that its laws are very similar to Nevada and they have lower initial and annual fees. Additionally, the State of Wyoming is currently very strong financially enjoying a huge budget surplus so there is no forseeable fee increase for maintaining your Wyoming business entity. Nevada also has a considerable surplus, however just because the state doesn't need any money isn't stopping special interests and unions for public employees and education special interests from pushing the Nevada legislature very hard to create massive unbearable taxes on all business entities in Nevada - Wyoming is very smart in this regard and not considering any new taxes on business entities.

Cons: Unlike Delaware and Nevada, much of Wyoming's case law is unproven.

INCORPORATION IN DELAWARE:
Delaware used to be the most popular state to incorporate in and is favored by many publicly traded corporations.

There is a serious advantage of Delaware to consider: The Chancery Court. This is a special court that only hears Delaware business entity cases. Delaware has an extensive body of corporate case law spanning 110 years regarding such matters mergers, acquisitions and management/shareholder issues. This is precisely why the Fortune 500 are drawn to the state of Delaware. Delaware laws tend to be "pro-management" when it comes to minority shareholder disputes. Huge public companies have literally hundreds of such disputes pending in the courts on any given day. So if you are managing a Fortune 500 company, Delaware’s case law offers many insights into what you can and cannot do, and what the likely consequences may be. Unfortunately, Delaware also has corporate income tax, personal income tax, a state franchise tax, reporting requirements and regulations compelling disclosure of substantial amounts of information resulting in far less privacy for you.

More than 60% of Fortune 500 companies are incorporated in Delaware. If you own a Fortune 500 company then by all means you should strongly consider incorporating in Delaware.

Cons: years of bureaucracy and unfavorable legislation has made it expensive to operate there. Delaware has cases where an officer was personally exposed but had they been a Nevada or Wyoming entity they would have been protected. Delaware has the highest fee to change your registered agent of any state in the nation.

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