Is there any reason why I should/can not file for LLC in Delaware?

I've been doing a lot of research and from what I can tell Delaware is the place to file an LLC. Since all of my revenue comes from selling advertising, I'm not necessarily doing business in any given state so I can file any where regardless of my location as long as I have an address in that state or a local agent to represent me. Is that assumption correct?

Here is a short summary of why I would want to file in Delaware:

Facts on Delaware Limited Liability Company Formation

* Delaware General Corporation Law is one of the most advanced and flexible business formation statutes in the nation
* The Delaware Court of Chancery is a unique business court that is very business friendly
* Delaware Corporations are not subject to state corporate income tax
* There is no personal income tax in Delaware.
* All limited partnerships, limited liability companies and general partnerships formed in the State of Delaware are required to pay an annual franchise tax of $200.00


Could someone explain the no corporate and no personal income tax in delaware? it sounds almost too good to be true but Im assuming Im missing something.

-Chris

 

http://answers.yahoo.com/question/index?qid=20060707192106AAQQaQU

Some interesting points on fees you'd still have to probably pay to your home state... might not save as much money as you'd think.

Jenn

 

Thanks for the link. How do you determine where you do business if your earnings come from online advertising on a content site (no ecommerce)? By where the checks are delivered? Where you live?

 

I'm not sure the answer to that question - I have incorporated in the super high tax state of California. However, I would also look into other states - like Alaska, Texas, and Nevada that have business friendly tax situations. If you are going to do something out of state, spend a thousand bucks and talk to an attorney about the specifics of your situation - it can save you a lot of money down the road.

Researching things on the web is a good start - it will definitely give you talking points for when you do talk to an attorney, but you simply cannot rely on information from unknown sources when you are dealing with tax law.

 

A good resource might be to read one of the books from www.nolo.com. They've got some great tax and legal advice for small businesses, and I believe they've got a whole book on DE corporations.

Jenn