Opening an LLC in Delaware is advisable for investors who want to provide high-class protection to their business at fairly low taxation. After all, one of the best conditions for doing business, both internationally and in the American market, has been created here. This makes Delaware home to more than half of the Fortune 500 companies today. This small state is home to the offices of Facebook, Twitter, and many other transatlantic corporations.
Why is it profitable to register an LLC in Delaware?
Most businessmen want to open an LLC company in Delaware for the following reasons:
Simple and affordable registration
Registering a Delaware LLC is much easier than setting up a similar company in another US state. All that is required is to submit the accompanying document and registration certificate to the Corporate
Branch and pay the registration fee. It is enough to indicate in the application: the name of the Limited liability company, the name, and address of the agent who will receive notifications on behalf of the legal entity. State law does not provide for any requirement for operating agreements, AGMs, or annual reports. And also, if you do not plan to conduct business in Delaware, a legal entity does not need to register with the state tax office and obtain a business license.
It is also allowed here to file documents and register LLC in Delaware remotely. Plus, the number of participants is not limited, as is the amount of capital. The structure of the company may even have one founder who acts as a director.
Taxation
Thanks to their loyal regime, many of the world’s corporations have chosen this state as their home. After all, if a company in Delaware does not conduct business in the state, then it is exempt from paying income tax or income tax. Plus members of the Limited liability company, who are non-residents, are not required to pay income tax. There is also no tax on intangible assets in the state, which makes it profitable to register holding companies in Delaware that manage patents or other forms of intellectual property.
The only obligations here are an annual franchise tax and an annual agent registration fee.
High level of confidentiality and asset protection
Many businessmen decide to open an LLC in Delaware to protect their assets. Unlike other US states, companies here are not required to disclose information about their beneficiaries. Such data is nowhere in the public domain.
Specialized economic court
Unlike other states, Delaware has its business dispute court – the Delaware Court of Chancery. Having our established base allows us to make decisions on claims within weeks, and not years, as in other states and countries. By the way, this state employs the most experienced lawyers in the field of corporate law.
Another important fact is that disputes in the Delaware Court of Chancery are settled by judges, not juries.
Flexible operating agreement
The structure of the operating agreement required for the LLC to operate in Delaware is not provided for by law. Company members can include in the text any rights and obligations, as well as divide them at their discretion, local laws do not limit this area in any way.
State law also allows verbal operating agreements to be used. But the latter option carries certain risks since conversations between company participants in court can be interpreted as terms of an operating agreement.
Seriality LLC
State law not only allows you to open an LLC in Delaware but also makes it possible to create a series of such companies. Moreover, each of the series is a separate legal entity that has its assets and is responsible for its obligations only with its property. In the event of litigation against one LLC series, the assets of the other series are reliably protected. Typically, this mechanism is used by companies that are engaged in the rental of real estate.
Read Next: How to open a company in Delaware [1]
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