In order to establish what or how much you will save by incorporating in Nevada, there are many issues to consider and it can be difficult to determine what outcome may result without knowing all of the facts.
To find out whether you, the business owner, will or will not save on taxes, you need to consider many issues. What follows is a sample checklist to determine if your company may be likely to save taxes by incorporating in Nevada:
1 Employees
2 State and local business license
3 Company address (not just PO Box)
4 Phone listing and phone number
5 Business is transacted
6 Fax number
7 Inventory
8 Plus several others!
In order to take advantage of incorporating in tax free Nevada, a company must create and maintain a NEXUS in Nevada. Nexus means a business presence in a state. When a company has nexus in a state, any state, that state has the right to tax that company on the income generated by the company. Items that may create a company’s nexus in a state are: a bank account, phone listing, office location, server, employees, contracts executed in the state, business license, and more.
Whether you or a professional advisor, assisting with the formation of a company, acting as a resident agent or forwarding mail, the key issue is: WHO IS DOING THE WORK IN NEVADA?
Many Internet and Consulting type businesses believe they can be based in any state so, why not Nevada? But you should consider: When you get your Starbucks coffee in the morning, does the receipt say Nevada or your home state? If a company has no employees doing the work in Nevada (an LLC does not require an employee, but where is the manager doing the work?) then the company must register to do business in the state in which the work is completed. A company can be based anywhere. A company may be incorporated in any state, but if operations (or nexus) occur in another state, it should be registered as a foreign corporation in the state where those operations occur.
These are all important items to consider when incorporating in Nevada in order to save or eliminate state corporate income taxes. KEY POINT: Nevada is very powerful when it comes to protecting the corporate/LLC veil.
Scott Letourneau is the CEO of NCP,Inc. and an authority in helping people form entities,grow their business,and protect the assets of that business. For more info contact: Scott Letourneau at 702-367-7373 or http://www.nvinc.com/whyincorporateinnevada.htm
Tags : Incorporate in Nevada, Save Corporate Tax, Nevada Corporations, Nevada Secretary of State
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