Open a company in Delaware
Studio Panama Italia regularly incorporates companies in Delaware, the Delaware LLCs , through its offices in the homonymous state. Opening a company in Delaware as an LLC Delaware has historically always been a habit of all digital nomads and companies operating in the most diverse sectors. In fact, opening a company in Delaware allows you to operate with a white list company, from the United States of America, still offshore and with zero taxes when it comes to legally evading taxes. Studio Panama Italia through its Holding Americana house, Shevat Consulting LLC operates as RA and Organizer in the United States to open American LLCs including Delaware LLCs. You can open paypal accounts with a Delaware company. Through a company in Delaware you can receive payments via stripe, wise, revolut, neteller. In addition, a company in Delaware allows you to open both online and physical bank accounts. Contact us to open your LLC in Delaware without obstacles and in full compliance with legal obligations and international standards.
How to open an LLC in Delaware
Opening a company in Delaware is therefore one of the many options available to entrepreneurs of today and tomorrow when it comes to having a business that is flexible and easy to manage remotely. Delaware is one of the most popular jurisdictions in the world to incorporate a company. Nearly half of publicly traded companies in the United States and more than 65 percent of all Fortune 500 companies are incorporated in Delaware. Including giants like Apple, Coca-Cola, Google and Wal-Mart.
Incorporate a company in Delaware : The Court of Chancery
Delaware is notable for its separate Court of Chancery, the oldest business court in the United States, specializing in corporate law. The Court of Chancery uses judges instead of juries and is usually well versed in complex corporate law matters. The Delaware Court maintains the most advanced and up-to-date corporate law, which allows for predictability and therefore less liability and litigation among Delaware LLCs. These predictable and clear laws allow companies to better assess the likely outcomes of litigation or the opportunity to resolve a case.
The legal and liability protections of corporate laws established in Delaware make the jurisdiction one of the most reputable states for business. A Delaware LLC requires minimum corporate structure requirements for its management, and there are no provisions for corporate meetings, directors, secretary or capital. A Delaware LLC can consist of only one member (member managed) who can also be its manager. ( manager managed )
Delaware Corporation: Delaware LLC Fees and Taxes
Delaware LLCs can choose to be treated as a C-Corp (subject to corporation tax) or be a tax transparent entity. The profits of a Delaware LLC that chooses to be a tax transparent entity are considered passed on to its members and taxed personally. Delaware corporation members pay personal income taxes on the profits of the LLC in proportion to their share in the LLC, whether distributed or not. This means that a Delaware LLC is not viewed as a separate entity for tax purposes, and therefore if its members are non-US tax residents, they will only be required to pay US tax on US sourced income. ( Territorial Taxation )
However, if their country of residence taxes foreign source income, members may be liable to pay taxes on all foreign profits in their country of residence, if required by the legislation of that particular country.
If its members are tax residents in a country that is exempt from taxes or territorial taxes and no income is from the United States, they can operate a fully tax-exempt Delaware LLC while benefiting from the reputation of a US incorporated entity.
It is important to note that some countries do not recognize an American LLC as a Delaware LLC for example, as fiscally transparent, if the Delaware LLC is deemed to be a tax resident in one of those countries, it may be subject to corporate income tax.
Companies set up in Delaware are reserved. The details of members, managers and officials are not disclosed in the constitutive documents of the company and are not available to the public.
It also has one of the fastest company registration processes and one of the lowest incorporation costs in the United States.
Delaware LLCs are excellent vehicles for international professional services, conduct international trade, e-commerce, Amazon FBA and gain access to merchant accounts.
Legal Advice : Ask yourself if a Delaware Corporation such as a Delaware LLC or a Delaware Corporation is right for you, or consider one of the proposed LLCs in other states such as one:
Wyoming LLC Opening | New Mexico LLC Opening | Florida LLC opening
Zero Taxes for Delaware Corporations
Delaware LLC Taxes
Delaware LLC Tax Residence: A corporation organized or incorporated under the Delaware General Corporation Law is tax resident in Delaware and the United States.
Delaware LLC Basis: Federal income tax is levied on US effectively related (ECI) income, and Delaware state income tax is levied on Delaware-derived income.
Taxing Delaware LLCs: Delaware Limited Liability Corporations can choose to be taxed as a C-Corporation or as an Ignored Entity.
Corporations are subject to federal income tax and state income tax.
Alternatively, an LLC may choose to be treated as a transparent entity for purposes of its member's personal income.
This means that it may not be subject to Federal Corp income tax and profits and losses may be reported through its members' personal tax returns.
Therefore, if its owners are non-US residents (and not subject to personal income tax) and the LLC does not operate and generate profits from the US, does not rent or own US property, and has no US employers, and no income actually connected, offshore income accruing to a Delaware LLC cannot be taxed in the United States.
Delaware Corporate Tax Rate: C corporations are subject to federal income tax at the rate of 21%. Delaware-derived income is subject to state income tax of 8.7%.
Delaware LLC Capital Gains: Capital gains or losses from assets held for more than 12 months are treated as long-term gains or losses, capital gains or losses from assets held for 12 months or less are treated as short-term gains or losses.
Net capital gains are the excess of the long-term net capital gain over the short-term net capital loss. Capital losses can be used to offset capital gains. Excess losses can be carried back three years and carried forward five years to offset capital gains.
Net earnings are subject to tax at applicable federal income rates.
Delaware LLC Dividends: Dividends received by a US company from another US company may be 70% deductible income. The dividend deduction can be increased up to 80% if the beneficiary owns between 20% and 80% of the distributor's shares.
Dividend payments between US companies that are members of the same Group may be exempt. Some companies may be subject to accumulated income tax on retained earnings if there is no justification for the accumulation to be based on business needs. Some holding companies receiving substantial passive income may be subject to Personal Holding Company Tax on retained earnings at the rate of 15%.
Dividends received from foreign entities may be considered deductible income.
Interest: Interest is generally included in the tax base.
Royalties: Royalties are generally included in the tax base.
Foreign Source Income for Delaware LLCs: Corporations are taxed on worldwide income, including foreign branch income when earned and foreign source dividends received. Relief from double taxation can be obtained through tax treaties, tax credits or by claiming a deduction for foreign taxes paid.
A foreign subsidiary that is more than 50% owned by U.S. tax residents is considered a controlled foreign corporation (CFC) . Some undistributed income (subpart F income) held in a CFC will be subject to tax.
Passive income withheld in a foreign investment company (75% or more of the income is passive or at least 50% of the assets held produce passive income) may also be subject to tax.
Foreign-source income is exempt from Delaware state income tax.
If a Delaware LLC elects to be treated as a disregarded entity and its owners are non-US residents (and not subject to personal income tax) and the LLC does not operate and generate profits from the US, does not rent or own US property and has no U.S. employer, offshore income accruing from a Delaware LLC may be exempt from income taxes.
Withholding Tax: Dividends, interest and royalties paid to non-residents are generally subject to withholding tax at a rate of 30%. Withholding tax may be reduced or exempt under a tax treaty.
Losses: Losses from taxable income can be carried forward for 20 years and carried forward for 2 years.
Inventories: Inventories can be valued at the lower of acquisition/production costs or market value. The methods First in first out (FIFO) and Last in first out (LIFO) are permitted for determining costs.
Anti-avoidance rules: Transactions between related parties must be carried out at market conditions. If a company is non-compliant, the IRS can increase its taxable income and the tax it pays.
Thin capitalization rules apply to disallow interest payments on excess debt and make these payments as dividends.
A foreign subsidiary that is more than 50% owned by U.S. tax residents is considered a controlled foreign corporation (CFC). Some undistributed income (subpart F income) held in a CFC will be subject to tax.
Passive income withheld in a foreign investment company (75% or more of the income is passive or at least 50% of the assets held produce passive income) may also be subject to tax.
Delaware LLC Tax Credits and Taxes
Employment Taxes: Employers may be subject to a social security tax of 6.20% on the first $127,200 of wages paid to employees and 1.45% Medicare tax on any wages, regardless of amount.
In addition, employers must pay, subject to certain conditions, the Federal Unemployment Insurance Tax (FUTA) of 6.2% on the first $7,000 of wages paid to employees who meet certain criteria.
Tax Credits and Incentives: A tax credit or deduction is usually available for foreign taxes paid.
Employment and business credits are also available to provide particular incentives to achieve certain economic goals.
Credits may also be available for Qualified Research Expenses (QRE) to develop new or improved products, manufacturing processes, or software in the United States.
Interest on eligible private business bonds may be exempt from federal income tax.
Compliance: On average, a U.S. business may require 11 payments and 175 hours per year to prepare, file, and pay corporate income tax, value-added tax, and employment taxes, including taxes on wages and social contributions.
Personal Income Tax: An individual is considered a U.S. tax resident if he or she is a citizen or permanent resident of or is physically present in the United States for 31 days in any year and a total of 183 equivalent days in the current year and the two previous years.
US citizens and permanent residents are tax residents, regardless of the days spent in the country during a year.
Tax residents are subject to worldwide income tax.
The federal tax rate is progressive with rates ranging from 0% to 39.6%. Delaware's personal income tax rates are progressive up to 6.6%.
Self-employed persons may be subject to self-employment tax at 15.3%. The rate has two parts: 12.4% for Social Security (retirement, survivors' and disability insurance) and 2.9% for Medicare (hospitalization insurance).
Capital gains arising from assets held for more than 12 months are subject to a maximum tax rate of 20%. Gains from assets held for 12 months or less are subject to tax at standard rates.
Dividends, interest, royalties and rental income are subject to individual income tax at the applicable rates.
In addition, individuals may be subject to net investment income tax (also known as Medicare contribution tax) on investment income received by individuals with adjusted gross income in excess of certain amounts.
Other Taxes: There is no value added tax or sales tax in Delaware.
Real estate ownership and transfer of assets are subject to local taxes in Delaware.
Real estate inheritances are taxed in the United States.
There are no wealth taxes in the United States.
Legal Basis on Incorporating the Company in Delaware
Country code: USA
Legal basis: Common law
Legal Framework: Delaware Limited Liability Company Act (Title 6, Chapter 18, Delaware Code)
Company form: Limited Liability Company (LLC)
Liability: Members' liability is limited to the extent of their capital contributions.
Capital – You do not need to register a minimum or maximum capital contribution.
Delaware LLC Members: A Delaware LLC may be formed by one or more members, who may be individuals or entities, resident or non-resident, without limitation. The identity of registered members of LLC Delaware may not be publicly disclosed.
Delaware LLC Manager: Members of the LLC can act as a manager or, alternatively, can appoint a manager. Corporate executives are eligible. Details are not publicly available.
Delaware LLC Registered Address: Every Delaware LLC must have an agent for process service in the state. This is an individual or legal entity who agrees to accept legal documents on behalf of the LLC. If the LLC is physically located in Delaware, it can act as its own registered agent. A registered agent can be a resident individual or business entity licensed to do business in Delaware. The registered agent must have a physical address in Delaware.
General Assembly: There is no legal requirement for formal meetings of members.
Electronic signature: Allowed.
Redomiciliation of a Delaware LLC: Foreign entities and other US companies can continue in Delaware.
Compliance: Accounting records must be maintained and must be sufficient to show and explain the company's transactions. The company's books, records and minutes may be kept in any place or country at the discretion of the Manager.
LLCs are fiscally transparent; profits and losses may be transferred through its members and subject to personal income tax. Alternatively, you may choose to have a Delaware LLC taxed as a C Corporation with the IRS and subject to federal corporate income tax.
Delaware LLCs may require a Federal Tax Identification Number (EIN). Also, most banks require an EIN to open a business bank account.
In addition to opening your Delaware LLC, you will probably be interested in creating a life insurance policy on your taxation, taking up a second tax residence, in a country with territorial taxation, such as a residence in Panama or a residence in Paraguay
Also consider a company in Panama
Get a Real American address in Delaware
Many businesses require not only the address of the Resident Agent (us) but also a real address. The reasons are many, insurance companies, credit unions, banks, and/or public bodies and above all customers must or may want to have access to your corporate address in the United States. Paypal USA for example, Wise, Revolut, require a corporate address different from that of incorporation or the Resident Agent. Without you traveling to the United States we can offer you a physical address that is yours alone where you can receive mail, parcels, parcels and mail in general which can be scanned (additional costs per scan) and can be sent to Italy or wherever you are at additional costs. The cost for this address, to be paid annually, is 350 USD per year with an activation fee to be paid only at the beginning of 400 USD, the total for the first year is therefore 750 USD and the subsequent years 350 USD.
Obtain real proof of Delaware address through a receipt/bill
Having an American address in Delaware if you have an LLC in this state is not necessary in some specific cases. You need to have real proof that you live or work there. But what do you do if the business is online, or you have opened an LLC remotely and have a US address purchased, perhaps through ours or other services? You need to have a real and not fake user account, to pay and then receive a real paper invoice or bill (PDF is not used in the USA), to give it to whoever requests it and therefore Banks, Credit Unions and the Government. In this case we offer a real telephone line through one of our companies that installs a real telephone number in the state you desire (any state in the United States) and sends the paper invoice monthly to your American address. Contact us to order one.
