Business Climate and Taxation
Oregon offers a good business climate aimed at supporting the growth of businesses. The Beaver State has a diverse manufacturing base and impressive innovation culture. Oregon provides the lowest effective tax rate among all states, at 3.3%. To take advantage, you need to register a new company in Oregon. You can form Limited Liability Companies and Corporations. These entities have advantages.
Wyoming doesn’t have a corporate or individual income tax, although property and unemployment taxes are higher. Delaware is considered the best state to incorporate large businesses because of multiple tax benefits. These include zero sales tax and zero corporate tax on fixed-income investments. Delaware offers flexibility in the corporate structure, and judges have expertise in corporate law.
When registering your Oregon corporation, you must appoint a registered agent and ensure your desired business name is available. It’s important to secure your URL right away.
Corporate-Friendly States
Wyoming, Nevada, and Delaware stand out as good choices for their business-friendly rules, privacy protections, and knowledgeable courts.
Washington and Oregon both offer beautiful nature and outdoor recreation opportunities, with factors like job prospects, cost of living, quality of education, and more determining which state is a better fit.
Incorporating in a corporate-friendly state is beneficial for corporations, with flexible laws, business breaks, and privacy. These states allow you to incorporate there, even if you don’t live or do business there. No matter where you incorporate, register as a foreign corporation in your home and operating state. You’ll need to keep up with tax obligations there.
The top 3 states to incorporate in are Delaware, Wyoming, and Nevada. State incorporation laws and regulations vary—some are business-friendly while others, like California, are almost anti-business. Delaware is the most common state to incorporate in, with the majority of Fortune 500 companies calling Delaware home. Delaware business laws create a “veil” which protects personal assets more than other states.
Choosing Where to Incorporate
Factors to consider when deciding where to incorporate include filing fees, privacy laws, and filing burdens. It makes sense to choose your home state in many cases. Reasons to incorporate elsewhere are liability protection and convenience. You can incorporate a business outside your home state unless it’s a state-licensed business.
From a tax standpoint, Wyoming, Nevada, and Delaware stand out as good incorporation choices. You may need to file as a foreign company if you do substantial business in a state you did not incorporate in. This subjects you to fees, taxes, and regulations there. Unless you are a large, multi-state company, it often makes sense to just register in your home state.