Many business owners choose to incorporate in their home state for convenience. However, if your state has an unfavorable corporate income tax, you may wish to incorporate in a more pro-business state. Both Delaware and Nevada are popular incorporation state choices. Delaware does not tax income from out of state and is generally considered a pro-business state. Nevada does not have corporate income taxes and they lack an information sharing agreement with the IRS. Both Delaware and Nevada handle much incorporation a year and the process is typically faster than in other states.

For example, if you live in Ohio and want to incorporate your business in Nevada you can do so with the use of a registered agent. The Nevada rules of incorporation state that you must have a resident of Nevada as your agent if you do not have an office there and a physical address in the state. Your registered agent can provide an address and forward all important documents to you. It is important to choose a well respected agent who you can trust to notify you of all changes in incorporation laws and forward your mail in a timely fashion.

Corporations are required to register as a foreign corporation in each state where they do business. This means if you do business in Ohio and are you incorporate in Nevada, you must register as a foreign corporation in Ohio. Incorporation in a more business-friendly state can be worth the trouble. Speak to your accountant or tax advisor about the potential savings to see if incorporation in another state such as Delaware or Nevada may be to your advantage.

No matter which state you incorporate in, there are definite advantages to incorporation. Removing yourself from the businesses liabilities is probably the main advantage and the reason most businesses incorporate.