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incorporation in DE or Nevada

tigerdialtigerdial subscriber Posts: 2
edited June 2008 in Business Planning
I will be starting a small business (single member LLC)  in California. I am  a resident of California.
My source of income for this business will be from outside USA. It will mostly be done online.
I have heard that people often incorporate LLCs in states like Delaware and register it as a foreign LLC in California. Is there any advantage to this approach as opposed to incorporating it entirely in CA?
Either way, minimum franchise tax of 800 dollars has to be paid. So, I do not see the advantage of incorporating in DE.


  • robertjrobertj subscriber Posts: 0 Member
    For a single member LLC - there really isn`t any. Setting up the LLC in Nevada will add at least another $200 to your costs.
  • tigerdialtigerdial subscriber Posts: 2
    Hi Robertj,
    I do not see any advantage even for other forms of business with DE or NV incorporation, outside of the state they are living in. Can you explain? What could be advantages for multiple member LLC?
  • robertjrobertj subscriber Posts: 0 Member
    There are a bunch of variables depending upon the specific situation. However, a couple of general comments:
    Because of it`s regulations and legal precedence -Delaware is thought of as a "corporate" friendly State. Nevada is ailing at that position and claims to offer a "non disclosure" for officers.
    In an LLC - California (for example) charges a fee (Tax) on revenues of the LLC over $250k per year.
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