Delaware Corporations Enjoy Many Advantages

2007-03-08 10:33:40

( Business )



If you intend to incorporate your business you may want to consider registering your corporation in Delaware. Delaware corporations benefit from a business-friendly environment in the state. The state has been known for laws that provide flexibility and protection to Delaware corporations and Delaware LLCs.

When you undertake Delaware incorporation, you must ascertain that the name you use is available. There are hundreds of thousands businesses with Delaware incorporations, so the probabilities of name duplication are high. You should conduct a Delaware corporation search for available names, just to make sure. Once your proposed name is cleared for use, you can form your Delaware corporation by mail or phone without visiting the state.

Your new Delaware LLC will be entitled to many tax advantages, which encourage many businesses to organize as Delaware corporations. The state’s tax incentives that you will enjoy include: no personal property tax, no sales tax, no inventory tax, no equipment tax and no state real property tax. You will also benefit from reduced personal income tax rates during periods when state revenues exceed expenditures. Your shares of stock are not subject to any estate taxes, if you're not resident of Delaware.

You will also gain operating advantages by organizing as a Delaware corporation. There is no minimum capital requirement, which gives you wide financial flexibility. You can hold multiple offices, like president and treasurer, simultaneously. Your company’s annual meetings may be held outside the state, or not at all, as long as the stockholders, directors or members (if you are a Delaware LLC) so decide.

Remember, however, that if you register your corporation in Delaware but will actually operate your business in another state, you will have to register and qualify to do business in that state. There will be additional paperwork and costs for you, both upon registration and during regular operations.


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