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The quick answer is - usually in your own
home state. Why? It's simple - cost.
The cost to incorporate as you'll see is usually only
several hundred dollars including state fees.
However, if you incorporate in a state other than your
own and do business in your own state, you must then
"qualify" or file for authority to do business
in your home state.
Remember that a corporation is an artifical legal entity
which can do almost anything a person can do, such as
enter into contracts, open a business, own real property,
etc. Each state has a valid interest in protecting
their citizens. This is one of the reasons why
you are required to appoint a registered
agent when you incorporate - to ensure that there
is a valid address where a state's citizens can serve
process if they are harmed and need to take legal action.
A state needs the same assurance from a corporation
formed out of state. It needs to know that the
entity was properly formed (the state may require
a "Certificate of Good Standing" from the
home jurisdiction) and who the registered agent is.
This information is disclosed in your Application for
Authority to Do Business (usually called the "qualification"
line - if you incorporate in a state other than your
home state, it will cost you an extra few hundred dollars
because you'll then have to qualify in your home state
(assuming you do business there.) Of course, the
extra few hundred may not mean much to you or you may
have a strategic reason for choosing to incorporate
in a particular state.
certain states, such as Delaware, or Nevada require
less information about the founders of a corporation
than other states and the added privacy may be important
to you. Delaware (more than 50% of the Fortune
500 are incorporated in Delaware) is attractive for
other reasons as well. Delaware has an extremely
well established body of law, does not seek to tax income
earned in other jurisdictions, has an excellent, informed
business court in its Court of Chancery and is very
pro-business. For all these reasons, Delaware
corporations are a known commodity in business circles
(particularly banking) and are always well received.
Among the other most popular jurisdictions for formation
are Florida, New York, New Jersey, and California.
that, as an affiliate of National Registered Agents,
Inc., we have a nationwide presence with affiliates
in each of the 50 states and internationally.
This enables us to create your entity anywhere from
Alabama to Alaska in the shortest time frame possible.