If you’re planning to start a business in America, it’s important to understand all legal and tax aspects of the process. Our team can help you establish a business in the USA remotely.
Choosing the best state for USA business registration
Selecting a state depends on several factors: What will your business do? What structure is planned? Which tax regime best suits your operations? Does your company need a license? Based on our experience, 90% of IT companies’ registration opt for Delaware or Wyoming, with a smaller portion choosing Florida. Delaware & Wyoming are popular due to favorable tax conditions and business-friendly policies. Wyoming offers 0% corporate rate, while Delaware’s – is 8.7%. However, avoid choosing a state solely based on tax rates, as this can be misleading.
Note: Consult a tax expert before setting up your USA company to avoid tax pitfalls & penalties!
Types of USA business registration
When starting business or acquiring an existing one, choosing right structure is essential. Your best options are:
- LLC (Limited Liability Company): This format is popular among entrepreneurs, especially non-U.S. citizens, due to limited owner liability, flexible taxation, and simplified management. Profits from an LLC are not taxed at the corporate level but passed to owners, who pay personal income tax. This protects personal assets in case of legal claims, although there are limits on the number of owners & some activities (e.g., financial or insurance services).
- C-Corporation: Ideal for larger companies or those seeking growth and investment. C-Corp can issue shares to raise capital, has unlimited existence, protects shareholders’ personal assets. The downside is double taxation: profits are taxed at the corporate level, then dividends are taxed again when distributed to shareholders.
Both structures have their benefits & drawbacks, so the choice depends on your specific business needs and plans.
