Is there any reason why I should/can not register an LLC in Delaware?

[CLKeenan]

I've been doing a lot of research and from what I can tell Delaware is the place to file an LLC. Since all of my revenue comes from selling advertising, I'm not necessarily doing business in any given state so I can file any where regardless of my location as long as I have an address in that state or a local agent to represent me. Is that assumption correct?

Here is a short summary of why I would want to file in Delaware:

Facts on Delaware Limited Liability Company Formation

* Delaware General Corporation Law is one of the most advanced and flexible business formation statutes in the nation
* The Delaware Court of Chancery is a unique business court that is very business friendly
* Delaware Corporations are not subject to state corporate income tax
* There is no personal income tax in Delaware.
* All limited partnerships, limited liability companies and general partnerships formed in the State of Delaware are required to pay an annual franchise tax of $200.00


Could someone explain the no corporate and no personal income tax in delaware? What taxes does this leave me to pay? Federal? It sounds almost too good to be true but Im assuming Im missing something.

-Chris

 

[Mill]

Ok but if you do not live in deleware some of these benefits are useless.

Any money made through an LLC is basically credited straight to the members. In other words if you make 100k and your the sole owner of the LLC, then you pay taxes on the full 100k. So unless you live in Deleware then you still have to pay personal income tax in the state you live because the earnings made by the LLC is really made by you,, an LLC just offers benefits to protecting your personal property in a legal battle.

So you unless living in DELEWARE must still pay state and federal income taxes and SS and Medicare.

 

[CLKeenan]

Are you sure? I've talked to Jon a few times about this and he said you didnt have to pay personal taxes, if I understood him correctly.

-Chris

 

[ZooYork]

Are you sure? I've talked to Jon a few times about this and he said you didnt have to pay personal taxes, if I understood him correctly.

-Chris

Yeah Mill seems to be off the mark. There is a reason of over half of fortune 500 companies are incorporated there.

I'm gonna read up more on this and get back to you

 

[Stanley]

What are the annual LLC fees for having it registered in Delaware?

 

[Mill]

Yeah Mill seems to be off the mark. There is a reason of over half of fortune 500 companies are incorporated there.

I'm gonna read up more on this and get back to you

Hahaha I am not off the mark. If you do not live in the state of deleware you have to pay income taxes to the state you live in. If you dont pay income taxes on the money you make regardless where the corp is, your evading taxes.

 

[Mill]

and your asking about an llc,,, an llc doesnt have any real tax benefits per say... the owners of an llc have to report the money from the llc on their personal taxes. There may be some benefits to a C-Corp but thats only due to the fact that you can claim as little income as you want.

I would definitely do some research, but I will tell you this, you have to claim your taxes on the state you live in regardless of where your llc is incorporated.

the only reason to file incorporation (S, C or LLC) in a state other than where you will have a presence is the way the state's laws and courts treat businesses.
From the tax perspective, you have to consider where you are actually conducting business. If you are working out of your house or an office in IL, you are conducting business in IL. The IL tax authorities are going to expect you to pay state taxes. If you don’t, you could face major fines, back taxes, interest, penalties and potential jail time.

If you live in one state and incorporate in another you must claim taxes earned in the state in which you live,, dont know how to be more clearer or own the mark.