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Whatever some commentators say, the United States of America is the largest economy in the world and there are good reasons for that. A business-minded person, including a business-minded person from another country, will find a number of huge advantages that the USA offers. If you open a company in America, you will reap the following fruit:
- Access to an enormous and solvent market;
- Protection by American laws;
- Opportunities to set up company subsidiaries in any place in the world;
- Trust on the part of your counteragents and good business reputation;
- Access to affordable loans;
- Bank account security;
- An opportunity to acquire a green card and maybe even to become an American citizen with time.
Stages of registering a company in the USA
You have to pass through several stages to establish a business entity in America and legal support would come in handy at each stage.
1. Preparation stage
First, you have to develop a clear understanding of why exactly you want to open a company in the USA. You may have one of the following goals:
- Make an investment in order to qualify for a long-term visa: Е-2, L-1, or ЕВ-5;
- Earn money in the USA without relocating to the country;
- Reduce your fiscal burden;
- Inherit property;
- Build an investment platform and expand your business internationally.
Depending on your prevalent goal, you can choose the market segment that your company is going to work in and decide on the form of the company ownership.
2. Choosing the state
The simplest and the cheapest way to go is to register a company in the state where you plan to perform commercial activities.
It is possible from the legal point of view to register a company in one state and do business in another one but you have to realize that some additional costs are going to be involved in this case. In accordance with the American legislation, you will have to pay the taxes in the state where your company operates plus the state where it is registered will charge you some fees.
When choosing the state where you want to register your company, you have to take the following factors into account:
- Requirements to company founders;
- The amount of the company registration fee;
- Conditions for resident and non-resident company owners;
- Specifics of the corporate legislation in the state;
- The process of appointing company director/ manager;
- Level of personal information confidentiality.
3. Preparation and submission of the registration documents
This may be the most intricate part of the company formation process in the USA. As a rule, opening a company in America is easier than opening one in Europe. However, certain states will have their specifics. Each case has to be treated individually.
Top 5 popular states for registering a company in the USA
There is no federal corporate legislation that would be applicable in all the states. Every state has its own regulations on company formation and each state decides what taxes have to be paid. You certainly need professional assistance in establishing a business company in the USA because it is impossible to know the rules in all fifty states.
Below we list the advantages that you can find in five American states that are the most popular ones with foreigners registering companies in the USA. What is the best state in the USA for business purposes? There is no answer to this question. You can only choose the state that is optimal for your central objectives. We recommend that you consider the five states listed below but we do not insist that you should not register a company in one of the remaining forty-five states.
Advantages of Delaware
· Efficient corporate legislation;
· Court cases are heard by judges rather than juries;
· The company head office can be located outside Delaware;
· Corporate income tax is not charged if the company is physically located in another state.
Advantages of Wyoming
· No fee is payable for registering the company managers;
· One of the lowest registration extension fees in the United States;
· Company directors and managers are protected by law from personal liability;
· ‘Corporate veil’ if the corporate formalities are observed and no fraudulent schemes or mixed funds are used.
Advantages of Nevada
· Company directors are free to alter the company documentation;
· ‘Corporate veil’ if no fraudulent schemes are used;
· Company directors, shareholders, and managers are not personally liable;
· The company head office can be located in any state.
Advantages of Florida
· Low company registration costs;
· Anonymity of shareholders;
· Natural persons are exempted from income tax;
· If the pass-through taxation system is applied, the company does not have to pay the corporate income tax.
Advantages of California
· Anonymity of directors, corporation managers, and LLC owners;
· No company registration fee is payable;
· Reduced corporate income tax rates for small businesses;
· Advanced fundraising opportunities.
How a non-resident can open a company in the USA
You don’t have to live in America to be able to open a company there. Moreover, you don’t even have to visit the country to register a company there. If you hire a reliable intermediary, you can open a company in the USA from another continent.
Types of companies that foreign nationals register in the USA
The key forms of company ownership in the USA are the following ones:
- Limited Liability Companies (LLC);
Corporations and LLCs are the types of companies most often established in the USA by non-residents.:
Key characteristics of an LLC
- An LLC provides limited liability similarly to a corporation and it can simultaneously be as flexible as a partnership;
- A non-resident of the USA can be the company owner;
- An LLC is the best form of company ownership for a small business venture;
- Personal property of the company owner(s) will remain intact if the company fails;
- Profits are distributed among the company founders and they are considered their personal incomes;
- The company will acts as the defendant if sued;
- Shares cannot be issued;
- Non-resident file fiscal reports only in their countries of residence.
Key characteristics of a corporation
- A non-resident can be a shareholder;
- A corporation can exist infinitely;
- Corporation founders are not personally liable for the company’s debts and they cannot be sued unless they break the law;
- This is the best form of company ownership if you intend to attract a large number of shareholders;
- Often a corporation is less attractive from the fiscal point of view because corporations have to pay a corporate income tax and then their shareholders have to pay personal income taxes on the dividends;
- A US-based corporation is a good offshore mechanism if all business operations are conducted outside the USA.
You can register a company in any American state but since they number 50, it may be difficult to make the best choice. Every state will have its own corporate legislation and its own tax system. For this reason, you’d better seek professional support if you would like to register a company in the USA.