State to start LLC with least tax/maintenance/report burden?
- posted by: Matiss on 2017-08-30
- tagged:
legal, llc, finance
- score: -1
I am looking to register LLC in US. Which state would you recommend to do so?
- Low to no maintenance cost on state level, as little reports and filings as possible
- Type is pretty much consultancy, customers from all over the place, US, EU, Asia
- Not looking for venture investment, so VC standing is irrelevant
- Sole owner
- Not planning to sell it
- I do not live in US
- There is possibility the LLC will own some shares or be a member in other companies. Afaik this should be no problem at all, in any state
Answer 13259
First off, be wary. Per this related question: as a sole business owner based in Spain, you almost certainly ought to register your company in Spain.
Long story short, countries will usually expect a business to be registered somewhere sane - that is, where one of its confounders resides, where it has employees, etc. Anything short of that and you’ll instantly run out of arguments the day a nosy taxman asks how your business is not a tax avoidance scheme. When operating a consulting business specifically (which I presume you’d use to invoice your own time and/or sell your software), you tick none of those boxes.
With this in mind, usual suspects (up to date source here) in the US include:
- Delaware, despite one of the highest corporate income taxes in the US, because of big-money friendly laws (a VC favorite for that reason) and the lack of sales taxes.
- Nevada - or more specifically the unincorporated place of Paradise, Nevada - because of the lack of corporate income taxes.
- South Dakota and Wyoming, for similar reasons as Nevada.
Insofar as I’m aware, none of these options are a panacea for filing purposes, and tax laws evolve at several levels in the US, so get an accountant to do the paperwork for you.
In the event you’re asking because you’re planning to move to the US, also mind that you’ll also need to register your business in the State you operate (i.e. live in) regardless of whichever other State you’ve set it up in.
Answer 13268
- posted by: Matiss on 2017-09-01
- score: 0
After doing quite some research, Wyoming looks like the most fitting place for creating a company that is not startup per-se, e.g. not looking for venture capital. However, there are some notes on this also:
- Registered agent will be required and reliable one is not cheap, because services providers know how attractive Wyoming is to do business. RA could be available from local attorney. Do not just google for registered agents in Wyoming, these results are littered with scams and companies not in Secretary of State roaster published here. If the agent is services firm and not in this roster, it is highly unlikely they are any good.
- The $50 annual report tax is a minimum and depends on company assets. See business fees listed in Wyoming Secretary of State website.
- The usual issues still - although WY sounds like a good idea, you should consult local business attorney and explain what your situation is and what are you going to do. Taxes, rates and reports in WY do depend on what the company does.
Bottom line, WY is great choice. But do your own research.
All content is licensed under CC BY-SA 3.0.