Hi,

Wonder if anyone could help me out here. I am in California and wanted to register for a Limited Liability Company providing Subscription Service over the Internet.

I am currently debating between Delaware, Nevada or California.

Anyone have any idea which is better? Least taxation even on flow through.

Give any comment you have, and if you know what is a good place to register for a LLC online, please list it here.

Regards
Mian

P.S. It is better if you are living in California and started an LLC here or elsewhere. Gimme the advantage and disadvantage!

Well, we would need much more information about your business to answer that question, in my opinion.

I believe that there are restrictions on forming a Corporation or LLC in Delaware - and one of those would be having to have an employee of the company residing in Delaware. I could be wrong on that, but I doubt it.

And honestly, if you are just starting, a little taxes won't matter much in my opinion. However, any excuse to have to bother with the incompetant fools at the California State Franchise Board is a major plus! :)

I would go ahead and stick to the general rule of thumb and incorporate in California. If you get big enough later, and can afford it, it may be avantageous to incorporate elsewhere.

Just my $.02. Congrats on the coming business!

LLCs in California are subject to an $800 a year tax paid to the Franchise Tax Board, regardless of revenue. If at all possible, I would not consider incorporating in California as the state is quite hostile to business IMHO [although if you're a CA resident you might still be subject to CA corporate taxes if you incorporate elsewhere]. Hope this helps, and be sure to get the advice of a lawyer and/or an accountant before you proceed.

Yes, avoid incorporating in CA unless it's absolutely neccessary. Their $800 franchise tax is a killer. Even if you are doing decent revenues, there's no reason to waste $800 every year if you file your papers in CA.

Originally posted by myleow
Wonder if anyone could help me out here. I am in California and wanted to register for a Limited Liability Company... P.S. It is better if you are living in California and started an LLC here or elsewhere. Gimme the advantage and disadvantage! I've been around WHT for a long time -- not active for the past year or so, but still lurk now and then; and when I was actively posting I always made sure I gave some pretty good advice (one can search on my username and read my postings and decide for themselves). And it always gives me the willies when someone comes here and asks legal questions. I love the level of expertise around here, generally; but some of the worst legal advice I've ever seen anywhere has been given in these forums... including this very thread.

This is a question best asked of a California tax attorney or, at the very least, a California CPA. It's a little trickier than it might seem. Absent that, having once been the MIS Manager at NOLO.COM (http://www.nolo.com), and knowing the attorney-authors there as I do, I can tell you that one of NOLO's publications and/or software regarding this matter would be the first and best place to start... not the WHT forums!

Click here (http://nolo.com/lawstore/products/product.cfm/ObjectID/749AB100-5AFD-479C-A637A296A830F6E2) to see a nice LLC-maker software package, written by a friend of mine, Tony Mancuso, at NOLO... the same fellow who also wrote NOLO's books, "Quick LLC-maker: All You Need to Know About Limited Liability Companies (http://nolo.com/lawstore/products/product.cfm/ObjectID/15B382A6-2013-4BD0-B0B66C80743CD9D0)" and "Your Limited Liability Company: An Operating Manual (http://nolo.com/lawstore/products/product.cfm/ObjectID/62190C22-D83F-4147-89C2A70041B9633B)," among others.

Hope that helps.

How can you skip the $800 Franchise Tax in California if you yourself is in california? Given that the business is internet base and the servers are somewhere else, but you are still physically located in CA and working from there even from your own home.

No, if you have a LLC in CA, you must pay the franchise tax.