USA
 

General Information

    Advantages:

  • North American free-trade agreement.  

  • Clear rules and instructions.   

  • The USA boasts a strong economy.  

  • There are situated the largest corporations. 

  • The USA has a big influence on the global market. 

    Disadvantages:

 

  • Growing capital controls.   

  • One of the highest tax rates in the world (almost 40%).  

  • Differences between state taxation. 

 

The United States has a federal system of government. This means that laws are made at the national (federal), state, and local levels. “Local” laws are those made by cities and counties that apply in those geographic regions. All 50 states have their own state and local laws that apply in those jurisdictions. Some areas of law, such as patent and copyright, are governed exclusively by federal law. Many other laws, including laws governing contracts, employment relationships, and sales transactions, are primarily set by individual states. And many other areas of law are governed by both federal and state law. When doing business in the US, foreign companies should be aware that they are subject to these parallel systems of laws which often differ from state to state. 

 

The United States has a highly developed mixed economy. It is the world's largest economy by nominal GDP and net wealth and the second-largest by purchasing power parity. It also has the world's eighth-highest per capita GDP (nominal)and the tenth-highest in 2018. The U.S. has the most technologically powerful economy in the world and its firms are at or near the forefront in technological advances. 

 

US GDP growth will slow to 2.2% in 2019 from 3% in 2018. It will be 2% in 2020 and 1.9% in 2021. 

 

Each state is a separate sovereign with its own constitution, legislature, executive, and judiciary.  

All law in the U.S. is subordinate to the Federal Constitution. When there is a conflict, applicable federal law will override state law. However, only the decisions of the Supreme Court are binding on the states.  

Legal Information

The most common forms of business are the partnership, corporation, and S/C corporation. A Limited Liability Company (LLC) is a business structure allowed by state statute. Legal and tax considerations enter into selecting a business structure. 

Tax Information

Top 3 states for the company incorporation

California  

 

California’s economy is stronger and bigger than ever before and has a GDP of $2.3 trillion. The state is home to 20 of the top 130 companies in South and North America. Hence, if you have thought of forming a startup company California then it is the best choice you can ever make. 

 

The statewide tax rate is 7.25%. In most areas of California, local jurisdictions have added district taxes that increase the tax owed by a seller. Those district tax rates range from 0.10% to 1.00%. Some areas may have more than one district tax in effect. Sellers are required to report and pay the applicable district taxes for their taxable sales and purchases. 

 

California's personal income tax has the highest top rate and one of the most highly progressive structures in the nation. After the passage of Proposition 30, California's top rate is 13.3 percent (including the 1 percent surcharge for mental health programs, for all personal income taxpayers with taxable income over $1 million). Hawaii is second, with a top rate of 11 percent. 

  

Most small businesses are S Corporations, partnerships, or sole proprietorships, and pay their business taxes at the rates for individuals, which makes California's taxes on small businesses some of the most burdensome in the nation. Seven states do not impose a personal income tax. 

 

Delaware  

 

More than half a million businesses, including half of all American, publicly traded companies, nearly two-thirds of Fortune 500 companies, and most technology startups have incorporated in Delaware. 

 

Delaware offers a lot of flexibility for structuring your corporation. Delaware’s corporate statutes are very flexible in terms of how you can structure your corporation and board members. For example, shareholders, directors, and officers don’t need to be residents of Delaware. What is more, Delaware corporations don’t need to disclose officer or director names on the formation documents.  

 

Businesses that are formed in Delaware but don’t conduct business there do not need to pay state corporate income tax (though there is a franchise tax).  There is no state or local sales tax. Delaware does, however, have an annual business license requirement, as well as a gross receipts tax that is imposed on the seller of goods or provider of services. Sales of tangible property are additionally subject to a retail or wholesaler license and gross receipts tax. These taxes are imposed on the seller and remitted monthly or quarterly, depending on the business activity, to the Delaware Division of Revenue. 

 

Every employer maintaining an office or transacting business in Delaware who makes payment of wages or other remuneration to a resident or non-resident of this state, must deduct and withhold an amount substantially equivalent to the tax estimated to be due from the employee. Delaware withholding is required, provided such payments are subject to withholding under the Internal Revenue Code and is remitted to the Delaware Division of Revenue. 

 

 

 

Nevada 

Delaware has traditionally been a favorite state for incorporation thanks to its strong pro-business institutions and laws. However, Nevada has recently emerged as a serious contender for small businesses that want to form an LLC. Each state has its own set of advantages, but there are key differences that can make one state more suitable for your business. 

Nevada offers a wide range of benefits as a state of incorporation, including its ease of registration, relatively low corporate taxes and lack of state taxes. 

 

The benefits of doing business in Nevada: 

  • No state income, corporate or franchise taxes 

  • No taxes on corporate shares or profits 

  • Strong privacy protection for owners, who can remain anonymous 

  • No requirement for operating agreements or annual meetings 

  • Fast registration times (businesses can register in as little as one hour for a fee) 

  • Low business registration fees 

  • Formation of single-person corporations allowed 

  • Permissive rules on the creation of shares, allowing them to be created for everything from services offered to real estate 

  • An efficient judicial system that often relies on Delaware case law to settle business disputes 

  • A strong corporate veil that protects agents, employees, officers, and directors from liability 

  • No formal information-sharing agreement with the IRS 

 

The Nevada state sales tax rate is currently 4.6%. Depending on local municipalities, the total tax rate can be as high as 8.265%. 

Other, local-level tax rates in the state of Nevada are quite complex compared to local-level tax rates in other states. Nevada sales tax may also be levied at the city/county/school/transportation and SPD (special purpose district) levels. 

 

All businesses that sell, transfer, barter, license, lease, rent, use or otherwise consume taxable tangible personal property in Nevada are required to register with the state and collect and remit sales tax. Providers of many services required to complete the sale of taxable tangible personal property must also register and collect. 

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