Under US law, the legal elements involved in forming and running limited liability companies (LLCs) depend on state law. If you decide to form an LLC in any of the fifty states across the nation, you will need to abide by the legislation of a particular state.
In this article, you will discover whether Florida is the best to form a non-resident LLC.
Forming a Non-Resident Florida LLC – Is it Worth the Effort?
It is not uncommon to find entrepreneurs who want to form an LLC out of their home states to seize advantage of pro-business legislation. Several states are well-known for offering fertile soil for start-up LLCs, including Delaware, Nevada, and Florida.
Determining whether it is a good idea to form a non-resident LLC depends on the particularities of each case, especially when it comes to cost and practicality.
For example, while the initial filing fees and annual costs to maintain an LLC in Florida are significantly lower than in most states, operating outside of state jurisdiction will require the business to operate as a registered “foreign entity.”
Operating a foreign entity adds another layer of complexity to the experience in terms of taxes and potential liability. For example, reacting to a lawsuit filed against an LLC in its formation state may result in a time-consuming experience and additional costs.
Is Florida the Best State for Non-Resident LLC? – A Realistic Overview
The last decade proved that Florida is not only a hub for tourists, “snowbirds” escaping cold weather and retirees. Solidly ranked as the fourth-largest economy nationwide, the Sunshine State proved to be one of the best places for start-up businesses, including LLCs.
The registration process with the Florida Department of State (Division of Corporation) is surprisingly cost-effective and convenient. Depending on how fast the Department processes your application, it is possible to set up an LLC between two and five business days.
All the relevant forms and documents are available online, which significantly reduces the time required to fill out and submit the paperwork. Florida filing fees are often lower than those charged in most states.
Once the LLC is formed, the owners (also referred to as “members) of the company can opt for special tax status. Companies elected as S-corporations enjoy “pass-through” taxation, which means owners only file taxes once at the individual level.
Members of an S-corp entity are exempt from state corporate income tax and personal income taxes. Franchise LLC businesses are not subject to annual franchise tax in Florida and there is no minimum capital requirement to incorporate a business.
Another advantage of forming a Florida LLC is the possibility to deduct contributions made by employees for disability and health benefits. In many cases, forming an LLC in your home state might not offer the same benefits as establishing a company in Florida.
Ultimately, it is crucial to consider whether the LLC will have its headquarters established in the state and conduct most of its operations within state jurisdiction. Consult with an expert LLC formation attorney to assess your circumstances and find the best strategy for your case.
Is Florida the Best State for Non Resident LLC? – Work with an Expert Business Attorney to Discover
A well-versed legal advisor in business formation law, Attorney Romy B. Jurado willingly wants to help you succeed. Contact us today by calling (305) 921-0976 or emailing [email protected] to schedule a consultation.Ā