With no State corporate, franchise or personal income tax, Nevada may be just the state to start a business in. What’s more, business documentation filing fees in Nevada are lower than in several other States and Nevada Limited Liability Corporations (LLC’s) can be managed by one person comprising all the roles of executive officers required by law in some other States. To clarify the distinction of non-taxation of Nevada businesses, the Nevada business code specifies that while LLC’s are not taxable as business entities at the State level, the income received from the business by its owners is still reportable at the Federal level via Internal Revenue Service filings. (tax.state.nv.us)
NEVADA BUSINESS INCORPORATION PROCESS:
The process of starting a business in the state of Nevada follows some standardized procedures similar to other states. That is to say State and Federal regulations are still applicable despite Nevada’s limitations on what information they report to the Federal Government. To be sure, an employer identification number is required for most businesses, and acquiring a registered agent is codified in addition to obtaining appropriate licensure and registration via the Nevada Department of Taxation. It is important to note, that a State Business License is not required for all corporations such as not-for profit corporations, revocable trusts and individually managed LLC’s (tax.state.nv.us), however municipal licenses or permits may be required even if a State license is not. Websites such as businesslicenses.com can be of assistance in determining which local licensure may be needed.
STATE REGISTRATION REQUIREMENTS:
Filing fees and State reporting requirements for Nevada businesses can be ascertained through the Nevada Secretary of State and Department of Taxation, that’s website is listed at the bottom of this article. As with other states, the filing fees and requirements can vary based on business structure. A registered agent can assist with this process and both the State filing and renewal fees are lower in cost than in several other States. To simplify the paperwork involved it may help to visualize the process in terms of a small series of tasks as listed below:
i) Compare cost advantages of Nevada businesses with other States
ii) Assess legal and regulatory environment for the business
iii) Perform a market and SWOT analysis (Strengths, Weaknesses, Opportunities and Threats)
iv) Evaluate and/or acquire capitalization, and assets necessary for operation
v) Obtain a registered agent
vi) Incorporate, register, document and pay fees as required
vii) Appraise the need for equipment, staff, property and additional insurance
Some of the steps involved in starting a business in Nevada should ideally be similar to starting a business in any location. These pre-requisite steps pertain to the business plan, marketability, capitalization, feasibility etc. The latter stages in starting a business are more State specific and involve determining fees, operating cost and profit margin benefits of State registration, filing and incorporation requirements in additional to legal protections and environment which the business will operate under. Researching these steps one by one via the sources provided with this article and via independent consultation with business, and incorporation specialists may be worth the initial costs if the business is likely to achieve profitability.
The advantages to starting a business in Nevada have to do with several factors including 1) ‘low’ registration fees, 2) favorable income, corporate and property taxes, 3) Business privacy rights and 4) a business litigation process similar to that of the Delaware and 5) ability to have individually run LLC’s. Some of these advantages are business specific meaning the type of business can effect how a businesses will be required to report income at the Federal level and file with the Secretary of State and Department of taxation at the State level. Generally, the advantage of registering a business in Nevada may be worth consideration, with potentially added benefits in regard to business that will benefit from local markets, revocable estate trusts and Limited Liability Corporations.
