• April 15, 2015

Nevada has no corporate taxes, right?

It is true that Nevada does not impose corporate income taxes.  This, and the fact that Nevada also does not impose personal income tax, makes it a very business friendly state.  However, this does not mean that you can escape taxation simply by forming a corporation or limited liability company in Nevada.  First, regardless of where you incorporate, the Fed’s are always entitled to a piece of the action, whether that is recovered through corporate taxes or personal taxes.  Second, if you are doing business in another state, you may be required to register to do business in that state, which may mean paying annual registration fees as well as state corporate income taxes or other taxes imposed by that state.  Third, if you are not a resident of Nevada, you may be obligated to pay state personal income tax in whichever state you do reside.

So what constitutes “doing business” in another state?  Here is a lawyer answer for you – it depends.  Every state has a different statutory definition of what constitutes doing business in that state.  It is fairly safe to say that if you repeatedly conduct activities in a state, like shipping goods from a warehouse or having salespeople visiting customers on a regular basis, that is likely to be considered “doing business” in that state.  This may mean that you need to register your business to do business in that state.

While Nevada is one of the most business friendly states around, which is one of the many reasons we love our beautiful Silver State, forming an LLC or corporation here, if you are not actually conducting business in our fair state, is not necessarily going to help you avoid taxes in another state.  The solution of course is for you to bring your business to Nevada.  We would welcome you with open arms.  But short of that, you should consult with an attorney and/or CPA before electing the state in which you incorporate your business.

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Cassell von Baeyer is a partner at the Incline Law Group, LLP. Incline Law Group, LLP - Providing Legal Clarity for Over 40 Years Incline Law Group, LLP, is committed to providing legal clarity. Our transparent approach to delivering legal services is designed to get beneath the surface of the matter in order to minimize surprises and maximize our clients’ outcomes. Founded in 1973 by John C. Rogers, Incline Law Group has earned a reputation for professionalism, discretion, honesty, diligence and positive results. Most of our attorneys are licensed in Nevada and California and have been providing legal clarity in the areas of Real Estate, Litigation, Family Law, Contracts, Business Formation and Estate Planning for over 40 years to our Northern Nevada and California communities. Cassell has been practicing law for 16 years and is licensed to practice in all courts of California and Nevada. Cassell's areas of practice include: -Real Estate transactions (commercial and residential) -Purchase and sale of real property -Commerce development -Common interest community developments and homeowner's association matters -Commercial development -Leases -Easements -Construction contracts -Mechanics liens -Land use -Distressed real estate, including judicial foreclosure -Business Entities and Transactions - formation and administration of business entities -Contracts -Real property -Business -Licensing agreements -Construction Cassell is a member of The State Bar of Nevada, The State Bar of California and the Washoe County Bar Association.