Nevada Formation Facility has a simplified process for forming an LLC, which means that business owners can get their businesses up and running quickly and easily. The state also has a low cost of incorporation, making it an affordable option for entrepreneurs and small business owners. The advantages of a Nevada LLC or limited liability company include the protection of the business owner's personal assets against business liability. Each state has its own laws governing the formation and administration of LLCs.
While most LLCs aren't subject to state taxes, owners pay taxes on their share of business-related income. If an LLC chooses to pay taxes as a corporation, it is subject to federal and often state corporate tax rates. One of the first benefits of an LLC in Nevada is that the state is a tax haven for small businesses. Nevada does not impose corporate income taxes of any kind. That means there are no corporate income taxes or personal income taxes.
Therefore, the legal benefits of forming the LLC in Nevada are now useless. If you are going to form or invest in an LLC, you can expect several advisors to encourage you to form an LLC in Nevada, regardless of the company's location. The transfer-based tax structure means that the LLC itself pays no taxes; the tax burden falls on members, who report their income on their personal tax returns. Creating a California LLC taxed as an S-Corp can help save money on self-employment taxes (but not income taxes). A single-member LLC can choose to pay taxes as a sole proprietorship, an S corporation, or a C corporation.
Nevada LLC benefits include low or no state taxes, high levels of privacy in public records for property owners, and the absence of a need for owners or members to reside in the state. The LLC originally had the authority to do business in its home state, since that's where it was formed. While it's true that the fact that your Florida LLC is owned by another LLC (an LLC that has a private record) will provide anonymity, it may not provide the asset protection you seek, that is, to charge order protection. Apparently, regardless of where the LLC is formed, the LLC is likely to operate in both California and Nevada.
Nevada liked the idea of abundant revenues derived from registration fees, which led to the formation of a large industry in Delaware to serve corporations (and LLCs). Since an LLC is governed by the state in which it was formed, each state has unique LLC laws, and those in Nevada are particularly attractive to businesses. In some states, a collection order allows the creditor to garnish all of a member's interests in the LLC, including their decision-making rights. Before establishing a Nevada limited liability company or LLC, you should compare the advantages and disadvantages of a Nevada LLC with other forms of business structure.
This flexibility is an advantage for LLC investors who prefer other experienced individuals to run the operation.
