Why Many Businesses Choose to Incorporate in Nevada.
Nevada is a very attractive option for businesses choosing to incorporate. Here are a list of the top reasons to consider it even if your business is not based in Nevada.
Nevada Protects the Corporate Veil.
Nevada offers it’s corporations great protection for its board of directors, even if you are the only member on the board and own all of the shares. In the last 24 years the Nevada courts have only allowed the corporate veil to be pierced twice, and both were for outright fraud cases. In comparison, one out of very two cases in California.
Nevada does not exchange information with the IRS.
The only other state to do this is Texas. Keep in mind that if you must register your corporation in another state, the state laws there will apply.
Currently the filing fees with Nevada are $125.
Nevada offers protection of Board of Directors from shareholder lawsuits.
The shareholders must prove gross negligence in order to find the Board of Directors liable. And to prove gross negligence is to pierce the corporate veil in Nevada.
In Nevada, you must only have a legal purpose to form a corporation or LLC.
Meaning, a person could form a Nevada LLC to hold personal assets. It is not required that the LLC have a business purpose to form.
There is no joint and several liabilities.
This means that if a judgment is entered against several defendants, they will each assume equal liability for the full amount of the judgment, regardless of their relative fault in causing the problem. In Nevada, courts are required to assign a percentage of faults to each defendant. And each defendant is only liable for their percentage.
One person can hold all of the corporate positions.
Nevada Protects the Board of Directors and Officers.
In 1987, Nevada passed a law permitting corporations to place their own provisions in their Articles of Incorporation that can eliminate the personal liablity of the officers and directors to the stockholders. Furthermore, this provision is automatic in Nevada.
Members are not required to be listed in state records.
Stockholders, directors, and officers are not required to be US citizens or live or hold meetings in Nevada.
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