Once the decision to incorporate your business has been made, the legal process begins with the preparation of a certificate of incorporation. Your next step is to select a state where you will form your business. The State of Delaware is a leading domicile for both U.S. and international business entities. Today nearly a million business entities have their legal home in Delaware including more than 50% of all U.S. publicly-traded companies and more than 60% of the Fortune 500 companies.
Businesses choose Delaware not for one single reason, but because of the complete package of business entity services it provides. Below are listed many of these benefits:
1. Delaware law has been tested and provides predictability.
2. Delaware regularly updates its laws to remain the leading state for incorporation.
3. Delaware has a separate Court of Chancery that handles corporation law cases quickly and competently.
4. Chancery Court issues decisions without jury trials, so their decisions are written, well thought-out and easy to follow.
5. Legal textbooks rely heavily upon Delaware corporate case law to teach law students because of the well written opinions from the Delaware Judiciary, so most American corporate attorneys have studied Delaware corporate law.
6. Corporate records can be kept anywhere in the world.
7. No formal meetings are required and shareholders need not be U.S. citizens.
8. Delaware has no sales tax.
9. Delaware has no personal property tax.
10. Delaware has no intangible property tax.
11. Delaware has no stock transfer tax.
12. There is no state income tax for Delaware corporations that operate out-of-state. (Federal Income Tax with the IRS must be filed annually, however.)
13. The Delaware Corporation minimum annual franchise tax is $75 and the filing fee is $50.
14. The Delaware LLC annual fee is $250, regardless of capitalization.
15. A business license is not required if the Corporation does not do business in Delaware.
16. Delaware corporations and LLCs can qualify to do business in all 50 states and in foreign countries.
17. State law permits a single person to act as a corporation’s president, treasurer, secretary, and sole director.
18. The Delaware LLC Act does not require the names of LLC owners to be listed in the formation document.
19. There are no residency or citizenship requirements for forming a Delaware corporation or Limited Liability Company.
20. The Delaware Division of Corporations generates a considerable amount of revenue for the State, so they have invested in state-of-the-art imaging equipment, and process new filings very quickly.
21. For companies looking to attract outside investment from angels, venture capitalists and private equity, incorporating in Delaware is often the best way to go. Many investors will only invest in a Delaware C corporation, so starting off with a Delaware corporation from the beginning can save legal and accounting headaches later.
22. Delaware offers a number of choices for speed of filing, depending on your needs and budget. The options are standard, 24-hour, same-day, two-hour and half hour.
To learn more, please visit: http://www.delaware.gov/topics/incorporateindelaware
Submitted by Linda Grund, Center Manager of STAT Office Solutions in Wilmington, Delaware, providers of both physical and virtual office solutions for companies around the world.
