Hey guys, so we have a business currently incorporated in the state of Oregon. After researching, we realized that since we will soon be filing our taxes as an S Corp due to exceeding $40,000 in NET income on a yearly basis, we believe our business would benefit from being incorporated in the state of Delaware with its lack of corporate income tax and lack of taxes on royalties/intangible assets. I have a couple questions on this:
1. Is it difficult to change your state of incorporation? Could we just file some papers with Oregon and switch to Delaware?
2. If #1 is not possible, would making our current business a member of a new LLC formed in Delaware work as part of a tax strategy?
Any other recommendations you guys have on changing the incorporated state of our business to Delaware would be great. We strongly believe our business will benefit in the years ahead based on the corporate tax laws in that state. Thanks for any help here!
Research shows that we would need to "dissolve" our business entity and operations here in Oregon, then refile for the same company name/entity type in the state of Delaware. This process concerns me a little and am wondering if anyone has experience changing the home/base state of incorporation for a business. Thanks again.
If you have 2 LLC in Oregon with 150-200k of assets and making 20-40k, say you had a holding company in Wyoming. Where would you file taxes?
Would you file in Oregon where the 2 llc are or in Wyoming where the SCorp is at?
Oregon. So your point is, the only way to be taxed as our home state is to actually do most of the business there. Here's the thing: our business is becoming 100% virtual. If our activities and assets are not central to any one state, would that change anything for us legally? I'm guessing this is going to be an emerging area of law as more and more companies go 100% virtual.
It sounds like to cross all our T's and dot all of our I's it would likely be best to dissolve in Oregon and refile in Delaware. However, I will plan on reversing that order and registering the business in Delaware first, then dissolving our Oregon incorporation/permits/licenses from there. A bit of a pain/hassle, but from what I've researched the tax savings we will experience via Delaware tax law will make all of it very much worthwhile. Thanks for your response.
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