Why Incorporate in Nevada - Nearly All Fortune 500 Companies are Incorporated in Nevada
Why Form a Nevada Corporation
Nevada is the Corporate Headquarters for some of the Countries best known Corporations. But why do they Incorporate in Nevada and should you choose to incorporate in Nevada?
There are 3 Primary Reasons to make your company headquartered with a Nevada Corporation:
- Favorable Tax Climate
- Legal Protection of Assets
The Nevada Secretary of State Publishes their own list of reasons to encourage business to locate their Corporations in the State of Nevada: Those reasons revolve primarily around a very friendly tax climate and include:
- No Tax on Corporations or Corporate Stock Shares
- No Franchise Tax or Franchise Tax on Income
- No Tax on Personal Income (Applies to All Business)
- Low annual fees
- No Inheritance or Gift Tax
- No Estate Tax
- No Unitary Tax
- Minimal Employer Payroll Taxes
In addition Nevada Corporations may hold, sell transfer and purchase shares of its own stock. Nevada Corporations my issue stock for personal property, capital, services, or real estate. Directors may determine the value of these transactions, and their decision is final.
Seems like a pretty solid sales pitch by the State of Nevada when you compare this to the incorporation laws of your HomeState doesn’t it?
Beyond the favorable tax climate is an even more compelling reason to form a Nevada Corporation. And that is legal protection of your assets!
When you Form a Nevada Corporation Nevada becomes or “Domicile”. You then register your Corporation in your HomeState as a “foreign registration”…this simply means your Headquarters for legal purposes are not in your HomeState If your company is sued the legal proceedings will most likely go back to your state of “Domicile”. Thus you get the legal protections of Nevada State Law. Of course you will want your chosen Attorney to review and process the paperwork for your newly formed Corporation.
I set up my own company as a Chapter S Corporation here in my HomeState a few years back. At that time I paid $500 for the attorney to draw up the paperwork, and the State Fees. I believe I got everything done for less than $800! The annual fee for my Corporation is $125. Fees vary by the size and type of your business. “Foreign Registrations” domiciled in Nevada will pay additional fees, but again when you compare these fees to the cost of your own State, Nevada almost always looks better. You of course may want to choose an LLC or a C Corporation.
Privacy for Nevada Headquartered Corporations Stock Holders
Nevada doesn’t want to know or keep track of who owns the stock of a Corporation. In fact the State of Nevada does not keep information on who owns corporate shares; there simply is no public record. It’s nobody’s business, but your own. This is the reason nearly all Fortune 500 companies incorporate in Nevada. Nevada is the only state that allows its corporation to use bearer share stock certificates. This makes it virtually impossible to prove ownership of a Nevada Corporation.
Most States require you to publicly file the name and address of a corporation’s directors, stockholders, and officers. Nevada requires only the name of the Corporations President, Treasurer, secretary, and directors. This means shareholder names are unless they are one of the preceding are never made public.
And one final thought: In Nevada you can be the Secretary, Treasurer, etc. That’s right one person can be the entire corporation.
This article is only a brief overview of the benefits of Incorporating in Nevada; you should of course seek appropriate legal counsel before you make your own decision.
Incorporate in Nevada - State of Nevada Seal
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