Nevada Corp
Advantages and Disadvantages

Nevada Corp Advantages and Disadvantages

Nevada Corporation

Nevada Corp - Incorporate in Nevada began with corporate statutes based on Delaware, and went even further to establish a corporate structure that allows investors and owners of Nevada corporations to remain completely private. The Supreme Court of Nevada has consistently taken a very strong stand in the protection of Nevada corporate privacy, even when a Nevada Corporation fails to adhere to basic Corporate-Formalities.

Incorporating in Nevada

Since the start of these Nevada Corporate privacy statutes in 1991, the number of new incorporations in Nevada has increased dramatically. Unlike most other states, Nevada does not require corporate stockowners to disclose their information. In fact, the information is not kept on file with the state of Nevada.

Additionally, to ensure privacy, Nevada allows its corporations to use bearer stock certificates, which make it virtually impossible to prove the ownership of a Nevada corporation. Accordingly, owners or investors utilizing bearer shares of a Nevada Corporation can have complete control and ownership while remaining anonymous.

Nevada also does not tax the income of its corporations or its state's citizens. A Nevada corporation is also not subject to any other hidden taxes such as franchise taxes, capital stock taxes, or inventory taxes. Sales tax applies only to products sold within the state.

Nevada ’s Corporation Code has been criticized by some as too pro-management, offering far too much flexibility in maintaining the corporation’s affairs. Critics have said that the law in Nevada's Corporation Law is not concerned enough about the rights of stockholders or employees of the Nevada Corporation. However, since the 1991 version of the Corporation Code was adopted, Nevada has experienced a 35% increase in the number of corporations filed in the state.

Most of these corporations are being formed by small companies, where the stockholders and the management are the same. These people are concerned very little with protecting their rights as a stockholder, since they also manage the company and receive all of the benefits of Nevada ’s liberal Code.

Advantages of a Nevada Corporation

Incorporate in Nevada offers many advantages as a preferred corporate state:
  • Nevada has no state corporate taxes
  • Nevada has no franchise tax
  • Nevada has no tax on corporate shares
  • Nevada has no personal income tax
  • Nevada provides total privacy of shareholders
  • Nevada is the only state without a formal information-sharing agreement with the IRS
  • Nevada is the only state that allows for the issuance of bearer shares
  • Nevada has minimal reporting and disclosure requirements
  • Nevada has nominal annual fees
  • Nevada allows for a one-man corporation
  • Nevada has established case law that prevents easy piercing of the corporate veil
  • Corporate officers and directors can be protected from any personal liability for their lawful acts on behalf of the corporation
  • Stockholders, directors and officers need not live or hold meetings in Nevada , or even be U.S. citizens
  • Only the names and addresses of the officers and directors are on public records. No other information, listings, or minutes of meetings are filed with the State
  • There is no minimum initial capital requirement to incorporate
  • Nevada corporations may issue stock for capital, services, personal property, or real estate. The directors alone may determine the value of any such transactions, and their decision is final

Nevada's 2007 Business Tax Climate Ranks 3rd

Nevada ranks 3rd in the nation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes; individual income taxes; sales taxes; unemployment insurance taxes; and taxes on property, including residential and commercial property. Neighboring states ranked as follows: California (47th), Oregon (10th), Idaho (31st), Utah (17th) and Arizona (25th).

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