Why Incorporate In Nevada And Not In Your Home State

2007-11-09 05:11:17

( Business )



Although a number of states are already gaining popularity for incorporation, Nevada is still the popular alternative for non-home state incorporation. Perhaps, you are asking yourself why incorporate in Nevada when you can incorporate in your home state.

One of the advantages that you would get for Nevada incorporating is that you do not have to pay for personal income tax, annual franchise tax, and corporate income tax. However, you must not forget that Nevada is not really a fee-free state. Within sixty days of incorporation, you will still have to pay fees for filing the corporation's initial declaration of officers and directors; thereafter, you pay fees for the annual statements.

The other answer to your question of why incorporate in Nevada is the anonymity of ownership which the state offers to its corporation owners. This can only be true, however, if the shareholders are not the same people who act as officers and directors of the company. Remember that Nevada requires that the annual statement contains the names of directors and officers. Since this annual statement is a matter of public record, the anonymity feature does not apply in this case.

Unlike many other states that have information-sharing agreement with the internal revenue service (IRS), this agreement is absent in Nevada. For this reason, the privacy of corporation information increases when you decide for Nevada incorporating. Another great benefit when you incorporate in Nevada is the permission to issue bearer shares. The transfer ledger of the corporation will only list bearer, and not the specific name of the owner of the shares. This provides another answer to the question why incorporate in Nevada.

You may get the above advantages when you incorporate your business in Nevada, however, check first the latest corporate statutes in your home state: the laws may be undergoing amendments, as in many other states.


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