Incorporating a company in Nevada has some major benefits which entrepreneurs and business owners should not overlook. Like Delaware, Nevada is well known for being a corporate haven, which is why large corporations which have their headquarters in California and other such states are incorporated in Nevada. Forming a LLC corporation (limited liability company) in this corporate haven has far reaching benefits like legal benefits and success of the corporation.
The state of Nevada does not have taxes like: franchise tax, corporate income tax, personal income tax, capital stock tax, no succession tax and no tax on corporation shares. Privately held corporations are particularly attracted to the state's flexible laws and benefits. Forming a LLC corporation means that there is limited liability for the owners of the corporation. An LLC has characteristics of both a partnership and a corporation but the owners are not fully liable for the actions and debts of the company.
The flexibility of forming an LLC corporation means it is perfect for single-owned companies. Chartering an LLC corporation in Nevada is an excellent strategic business move because of the favorable business conditions in the state. One such benefit is that Nevada laws give flexibility to a board of directors who manage the affairs of the business and can protect the corporation from hostile takeovers.
Another legal benefit of forming a LLC corporation in Nevada is that there is very strong legal protection against piercing of the corporate veil. In the history of case law in the state, there has only been one case where piercing of the corporate veil was permitted due to owner fraud. Also, unlike other states, Nevada allows the corporation's directors to adopt, amend or repeal bylaws, taking power away form shareholders.
While there are no corporate taxes in Nevada, there is however an annual $100 business license fee which is paid to the Nevada Department of Taxation. Along with Texas, Nevada is one of two states in the USA who does not share information with the Internal Revenue Service (IRS). Forming a LLC corporation in this state does require certain formalities which have to be adhered to periodically, however this does not outweigh the many benefits which your LLC can gain.
These formalities are a small price to pay for the protection and flexibility that forming an LLC corporation in Nevada can give you. Incorporating your business can bring credibility and prestige which is attractive for investors and potential employees. There is a widespread bias among vendors, banking institutes, clients etc that favors the formalized business structure over the less formal proprietorship or partnership. Whether this bias is justified or not can be debated, however, the reality is that it does exist and your business should act to improve its credibility.
Another benefit of forming a LLC corporation is that you can enjoy greater freedom when it comes to future financing because you will not be limited by 'acceleration clauses', 'subordination clauses' and other restrictions which would affect sole-owner businesses. For more information on forming a LLC corporation, visit Corporate Capital Formation Inc. website: http://nevada-business-corporation.com.
