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It's a state that has services very well streamlined, and it's perfect for C-Corps. For LLCs, probably the best state will be Wyoming. We recently launched our
by jpincheira 5y ago
It's a state that has services very well streamlined, and it's perfect for C-Corps. For LLCs, probably the best state will be Wyoming.
We recently launched our new company [1] and are deep into helping entrepreneurs getting started mostly in Delaware and Wyoming.
[1] https://startpack.io https://startpack.io
- vageli 5y agoWhat makes Wyoming the best state for LLCs?
- jpincheira 5y agoFrom our experience, most customers go for Wyoming LLCs because of the cost-effective option of a $50 Annual filing charge as compared to Delaware which has a $300 Annual franchise tax. The option is totally up to you. We wrote a guide around how to choose the best state for new LLCs [1] [1] https://www.startpack.io/best-state-to-form-your-llc-in https://www.startpack.io/best-state-to-form-your-llc-in
- itake 5y agoMy understanding is that if you create your LLC out-of-state, you still need to register your llc as a foreign entity, which often, puts forth the same requirements as an in-state LLC. Take specifically California. If you live and operate in CA, but register your LLC in Delaware (or Wyoming), you still need to pay the $800/yr franchise tax and complete all of the same tax paperworks that you would if the LLC was registered in CA. Isn't it just simpler (and cheaper in time and money) to register in the state you operate in?
- arjawn 5y agoIf you live in the US, correct! It's best to form an LLC in the state you live in. If you live internationally, you can actually choose any state to form an LLC in (and Wyoming + Delaware tend to be the two most popular options, Wyoming for online digital businesses due to the lower ongoing annual costs = $50 per year to the state vs $300 per year in Delaware!)
- vageli 5y agoJust a friendly heads up, there are a few copy issues on that page, like > AsLLCs are overseen at a state level. Any LLC that has been registered in that state, and conducts business there, is called a Domestic LLC.
- itake 5y agoMembers nor Managers are not listed with the state My main issue with out-of-state LLCs though is you typically have to file in whatever state you're operating/living in as a foreign LLC, so you end up with double the paperwork and filing requirements. IMHO its better, especially for sole-proprietor / pass-through LLCs to just register in whatever state you're living in.
- arjawn 5y ago100% not worth the headache so better to file in the state you "do business in" = home state! But as an international resident world is your oyster and you can choose any state :)
- IncRnd 5y ago> 100% not worth the headache so better to file in the state you "do business in" = home state! This is only true until someone attempts to sue for a triviality. Most companies get sued at some point in time. This is why such a service is of value.
- ilovepitchdecks 5y agoThere's no no need to use a formation service. Incorporating a company in the US is very easy and can be done online, even by foreigners. All you need is a Registered Agent and they start at $25/year (in Wyoming). I'd also like to point out that forming a LLC as a foreigner is a bad idea, as that might make you personally liable for US taxes. Either form a C Corp outright or have your LLC taxed as a C Corp. Then just zero out the profits. Some extra forms to fill out, but still better than paying taxes.
- igammarays 5y agoHow does one zero out the profits? Pay yourself as a contractor?
- ilovepitchdecks 5y agoExactly. If you're outside the US, you can only be a contractor, even if you work full-time for your company. There are no caps on how high a contractor's fee can be - that's not the case with employee salaries. There are more fancy options, such as having a second, foreign company owned by you be the contractor - if you want to avoid personal income taxes in whatever country you live in. Beware of CFC regulations though. For US founders, S Corps are better.
- jdhn 5y agoWhy would you go to Wyoming, and not Nevada?
- arjawn 5y agoFor international LLC owners, Wyoming has lower ongoing annual fees! $50/yr in Wyoming vs $350/yr in Wyoming! Also I call out international above because if you are a US resident you should form an LLC in your "home state" aka the state you do business in!