Why Nevada?
For years Nevada claims to be the "incorporating capital of the west", and to support that claim it has spent more than a decade developing the appropriate legal infrastructure. Determined to establish itself as a leader in incorporation, Nevada had completely revised its Corporate Code in 1987, and again in 1991, making the entire incorporation process quicker and more efficient, with greater liability protection than ever before.
Unlike Delaware that targets larger corporations, Nevada positioned itself more suitable as a home for small, privately held corporation. With no corporate taxes of any kind, maximum liability protection for corporate officers and directors and ease of establishment Nevada has become the attractive choice for those wishing to incorporate themselves and their business activities.
That being said, recent political and fiscal developments in Nevada, which brough introduction of expensive Business License and Initial List filing requirements, as well as outrageous renewal fees and rough treatement of delinquient businesses, have significantly reduced the attractiveness of the state. Wyoming became the state of choice for many businesses that traditionally incorporated in Nevada, and many established Nevada businesses are choosing to change the corporate domicile to Wyoming, thanks to the friendly domestication laws in Wyoming.
Some Facts
Here are some facts dealing with forming a company in Nevada:
- Nevada has no state corporate taxes.
- Nevada has no franchise tax (but it has general Business License, which must be renewed annually).
- Nevada has no tax on corporate shares.
- Nevada has no personal income tax,
- Nevada provides total privacy of shareholders.
- Nevada is the only state without a formal information-sharing agreement with the IRS,
- Nevada has established case law that prevents easy piercing of the corporate veil.
- Corporate officers and directors can be protected from any personal liability for their lawful acts on behalf of the corporation,
- Stockholders, directors and officers need not live or hold meetings in Nevada, or even be U.S. citizens,
- Only the names and addresses of the officers and directors are on public records. No other information, listings, or minutes of meetings are filed with the State,
- There is no minimum initial capital requirements to incorporate,
- Nevada corporations may issue stock for capital, services, personal property, or real estate. The directors alone may determine the value of any such transactions, and their decisions are final.
Nevada is one of the three states commonly recognized as "corporate heavens", the other two being Delaware and Wyoming. Before making your choice please see our article that runs a comparison DE vs. NV. vs. WY.