Entity formation - WY, NV, DE

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by a searcher from Widener University
in Jefferson Township, PA, USA

1yr ago

Entity formation - WY, NV, DE

When choosing a state to form your entity, what are the advantage/disadvantages of WY vs. NV vs. DE? There are probably other states that offer equal benefits, but I know these 3 tend to be somewhat popular amongst business owners and their legal teams.

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reply by a searcher 1yr ago
from Indian School of Business in Raleigh, NC, USA

I wont repeat what others have already said. But its important to realize that if you pick one outside of the state where your business operations, you will likely have to file as a foreign entity in the home state which nullifies many of the advantages of Wy/Nv/De

reply by a professional 1yr ago
from American University in Irvine, CA, USA

Hi, Thomas. Sometimes, we have seen clients that will set up their LLC in a state which they feel will provide tax benefits on income generated to the owners, but then operate the LLC using the partnership accounting rules, forgetting that the pass-through nature of those rules will bring their allocated share of the income back to the owners in their home states, which defeats the purpose. It is important to analyze all of the legal and accounting aspects of your business in making the decision where to locate. If you would like to discuss this further, feel free to DM me.