One of the most important decisions you’ll have to make for your LLC is choosing the state in which to incorporate. In recent years, Nevada has earned a reputation as one of the friendliest states for business incorporation in the US, rising to equal footing with Delaware.
Many business owners choose to set up their business in Nevada, knowing they will benefit from significantly reduced tax burdens as well as strong asset and privacy protection and an efficient legal system for corporate disputes. Here are some of the top reasons why you should register your next business in Nevada.
1. Tax Benefits
Currently, Nevada is one of seven states where LLCs are not charged state income tax. This means that your LLC is not subject to taxes for the income it makes in the state of Nevada.
Additionally, the tax benefits of Nevada LLCs don’t end there. Your company is also exempt from paying corporate and franchise taxes, and you as the business owner will not need to pay personal income taxes.
These tax benefits can result in significant savings, which can be of tremendous importance for first-time business owners and startup founders.
LLC registration fees in Nevada are currently a total price of $425. To register you must pay $200 for a business license, $150 for a list of officers, and $75 for articles of organization. Do note that business license and list of officers must be filed annually, so you’re looking at $350 annual filing fees, which is still significantly less than some states like California.
2. Asset and Privacy Protection
Nevada is known for a strong corporate veil that protects all employees, agents, and directors from becoming personally liable for the business, which is why many business owners choose to incorporate here.
Furthermore, Nevada doesn’t require firms to list company assets, which means there is no record of the asset being linked to your company, except when you are making filings with the IRS.
Another benefit of forming your LLC in Nevada is privacy protection. It is not required that owners or board members of Nevada LLCs be listed in public records when filing with the state, assuring an extra layer of anonymity.
3. No Requirement for Operating Agreements or Annual Meetings
A benefit of forming an LLC in Nevada is that you are not obliged to have an operating agreement in place.
An operating agreement is a document that outlines important aspects of your business, such as how decisions are made, how the LLC is divided among members, and what happens if a member needs to withdraw from the company.
Although you are not required to have operating agreements in Nevada, we recommend you still have one in writing.
Another flexibility offered by running a Nevada LLC is that a company’s annual meetings do not need to take place physically within the state, but can be organized anywhere in the world or via teleconference.
4. Fast Registration
Generally speaking, all you need to do to form an LLC in Nevada is to sign the Nevada Articles of Organization and file them with the Secretary of State. This can be done online or over the phone, and you will receive an approval within 24 hours.
If you want to register your business even faster, in a matter of hours, you can file the application online through Nevada's Silverflume.
Once you fill out the information about your new business and make the payment, your business will be registered and ready to operate. It is also important to note that before you can register your business, you will need a registered agent in the state of Nevada.
5. Favorable Business Law
When it comes to the way it addresses legal business disputes, Nevada functions similarly to Delaware.
In fact, over the last two decades, Nevada has been investing significant efforts to create a business-friendly environment that mirrors Delaware’s and offers significant benefits to business owners.
Nevada’s legal system for corporate disputes is efficient and business-minded. In the case of business disputes, a non-trial court presides, resolving corporate issues without a jury.
Typically, business disputes in Nevada are resolved speedily. There is a judge who specializes in corporate law, with expertise in resolving complex corporate disputes.
In addition, Nevada has a business-friendly state government and flexible corporate laws. As a rule, Nevada business owners have access to a robust legal system that offers adequate protection and addresses corporate issues diligently.
Conclusion
Forming a business in Nevada offers a handful of benefits to LLC owners. Nevada LLCs provide numerous tax benefits, strong privacy and asset protection for business owners, operating flexibility, fast registration, and a dedicated court with streamlined processes for resolving business disputes.
It is one of the best states in which to form your LLC, especially if you are a first-time business owner looking for helpful business administration.