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Anecdata: the well-developed legal field is the prime reason why my corporate attorney always pushes his clients to incorporate in Delaware. He and his firm kno
by whafro 10y ago
Anecdata: the well-developed legal field is the prime reason why my corporate attorney always pushes his clients to incorporate in Delaware. He and his firm know what to expect throughout the process, and can offer much more reliable advice than when you incorporate elsewhere or in your home state (even California).
Delaware residents certainly have a favorable tax situation, with zero sales tax and very low property taxes, but that's mostly because they get tons of income from the franchise taxes applied to corporations registering there.
And if you're a first-time founder getting your first Delaware franchise tax bill, you're not going to consider the process favorable by any means.
- Thrillington 10y agoAnd filing in Texas is the same for patent prosecution. The plaintiffs know what to expect: interpretations from the bench that heavily favor them. It's not well developed law when the decisions are so disproportionately weighted towards one side of the courtroom.
- TheCoelacanth 10y agoA key difference with Delaware is that the people choosing to incorporate there typically don't know which side of the law suit they will end up on. The location of incorporation mainly matters for when shareholders sue the company which means they are effectively suing the other shareholders.
- lhopki01 10y agoDelaware basically operates like a tax haven. It allows companies to avoid taxes in other states by shift royalty profits to Delaware. It is also extremely popular as a location of shell corporations because of secrecy laws. To form a company in Delaware you are barely required to give any information. I'm not denying that there are also network effects but if you got ride of the tax benefits and secrecy those network effects would go too.