The business will be located, and operated in Texas. We plan to start in retail, but eventually also branch out into real estate. Our intial thoughts were to use Nevada, but we later found out that they have hidden annual fees for companies that don't operate in NV. Any assistance will be greatly appreciated.
Answers
With a small business there is virtually no good reason to incorporate or organize in any state but the state where the business is located. While there are good arguments for Delaware corproations and Nevada LLCs, those arguments always center on much larger enterprises and never mention that if you form in another state you are now a "foreign" entity in your home state and must file for permission to transact business. This usually adds another renewal fee and a registered agent in your home state, which will add a couple of hundred dolars in annual fees. If there are some advantage to the law in another state, such as the Series LLC in Nevada and a few other states, you can convert later when it is needed. For the beginning though, I suggest a Texas LLC or corporation and as you add other kinds of business, form additional LLCs or convert the whole thing into a Nevada or other state Series LLC or Virgnia Business Trust (essentialy the same thing as a series LLC). By using the conversion statute you will retain the EIN you are first issued and keep your account at the IRS organized and moving forward.
You may want to consider incoporating in the State of Delaware - Google "The Company Corporation" who handles everything - including being your required Agent.
Otherwise consult an organization such as SCORE in your area for advice - they are retired business people who give fee advice on the "how to's"
Good Luck with youe endeavour!!
Thank you for your service, Larry.
As Jim said, there is little reason to incorporate in any state other than the state in which you operate. Texas has strong laws that benefit businesses.
SCORE is an interesting suggestion, but I have had terrible luck with them and almost all of their advisors have backgrounds in large companies. Their small business advice can be wide of the mark.
Real Estate laws are unique to each state and most states require a specific license with little/no reciprocity.
Feel free to call me if you want to talk something over. My background includes heavy experience in retailing - large and small. 713.503.3535.
Good luck!
Richard
ditto Laurie's answer see score.org
Your Answer
Pleaselog into answer this question.