The Nevada Myth

October 8th, 2022 by admin No comments »

After you have decided that incorporating is beneficial for your business,Guest Posting some people consider incorporating in states outside of their home state. Most notably, Nevada has been promoted by many “incorporating services” as having incredible benefits as opposed to the client’s home state. Other states such as Delaware and more recently Wyoming have also received consideration for incorporating. In some cases, depending on the facts of your business, there are some benefits in forming an out-of-the-home-state corporation in states such as Nevada. However, in the majority of cases the benefits of forming a Nevada corporation is simply a myth and will often be more expensive and troublesome than filing in the company’s home state.

Law of the Land: Foreign Entities

This may be a surprise to many, typically, corporations will be governed under California law despite being incorporated in Nevada. Let’s assume you do file a Nevada, yet you operate all of your business in California. Under this scenario, you are deemed to be a “pseudo foreign” corporation. If the corporation is a pseudo foreign corporation, California law in many areas will supersede the law of the state where the company was incorporated in. (See California Corporation Code §2115(b)). Therefore, for companies entirely based in California and doing business in California, practically all of the claimed benefits of incorporating in Nevada are out the window. It should be noted that if a Nevada corporation operating in California fails to qualify as foreign corporation, it may be subject to a number of sanctions. (See California Corporation Code §§2203, 2258, 2259).

Nevada v. California

The benefits typically touted by a Nevada corporation are the following: lower costs; tax savings; and greater privacy. But is any of it true? Below we will discuss some of these issues.

Nevada LLC Attorneys

March 16th, 2022 by admin No comments »

There are many different ways in which a company can be incorporated. It not necessary for business owners to get the services of an attorney, but it is recommended. The State of Nevada has a pro-business stand towards piercing the corporate veil. Business owners choose to make Nevada their domicile state of business so that their personal assets are not threatened, in case of a lawsuit. A limited liability company or LLC can be set up in Nevada, by submitting articles of organization to the Secretary of State. This can be done with the help of a resident agent. Nevada LLC attorneys specialize in incorporating companies in the state and are resourceful.

An experienced Nevada LLC attorney is able to analyze the requirements of the company. He is able to make an unbiased judgment of the basis of all governing factors. The attorney can also advice the clients about the pros and cons of establishing a limited liability company. This is important, as setting up a corporation and a limited liability company, are different, mainly in the manner in which tax is paid. The LLC attorney can guide the business owners towards the benefits of setting up a limited liability company, rather than a corporation, even though they are more formal.

LLC attorneys help the business owners write the various documents along with the operating agreement. This is clearly defines the methods of operation and percentage of profit allotted to each member. The attorney also assists in putting on paper, the rights duties and obligations of the LLC members. This can have far reaching effects on the filing of the federal income tax. Additionally, LLC attorneys can be retained, to manage the issues of members as well as non-members, such as, transfer of interests within the LLC and its termination.