Formation of a Limited Liability Company in the USA (Nevada LLC).
A Nevada limited liability company is an effective business tool for tax optimisation and asset protection for non-US residents. There are no taxes on corporate shares or profits, and no state income, corporate, or franchise taxes.
It also boasts low business registration fees, quick turnarounds, and no requirement for annual meetings or operating agreements.
FACTS & INFO
In October 1991, the state of Nevada enacted the Nevada LLC Act which enabled the formation of a Nevada LLC. An LLC is a combination of a corporation and a partnership which has become extremely popular in recent years. Like a corporation, an LLC has a legal existence separate from its owners; the owners and managers are not personally liable for the company’s debts and obligations. Like a partnership or an S-corporation, an LLC is automatically treated as a pass-through entity for tax purposes. Key elements of a Nevada LLC include:
- A creditor of the owner of a Nevada LLC cannot seize the assets of the LLC.
- A single-member Nevada LLC is automatically disregarded as an entity separate from its owner and includes all of its income and expenses on the owner’s 1040 tax return.
- A Nevada LLC with two or more members is treated as a partnership.
- There is unmatched contractual flexibility with a Nevada LLC. Nevada law provides rules only on matters on which the members have failed to agree. This is known as freedom of contract.
- Personal liability is limited for owners and managers to the amount of their investment in the company, just like a corporation.
- Non-US owners of a Nevada LLC with no US source income pay no US taxes whatsoever.
- A Nevada LLC may be formed by one or more organiser or member.
A Nevada LLC is a unique non-taxable offshore corporate structure, frequently used for conducting international business outside of the United States. An LLC is formed by one or more business people, as owners. The owners, called members, file articles of organisation and set out an operating agreement. An LLC is a pass-through type of business, because the profits and losses are passed on to the members depending on their share of membership.
A Nevada LLC may not use a name identical or similar to an existing company within the state of Nevada. The use of the following words is also prohibited: "Bank", "Insurance", or "Reinsurance". The company must have the words "Limited Liability Company" after its name (or an abbreviation thereof i.e. "LLC" or "L.L.C.").
An LLC does not issue shares and therefore does not have shareholders. The owners of an LLC are referred to as members. A Nevada LLC may have a minimum of one 'member' (owner) or more. Each member of a Nevada LLC is liable only to the extent of his or her percentage of ownership in the LLC. Members may be individuals or corporate bodies. There is no limit on the number of members allowed in a Nevada LLC.
DIRECTORS AND COMPANY SECRETARY
The management of a Nevada LLC is based on an agreement between its owners, who are known as members. It allows for a customised management structure, which dictates the economic relationship among owners. While Nevada law permits an LLC to be managed by its members, it does not require members to be managers. The Nevada LLC statute allows parties to define their business relationship in the written agreement however they wish. This is called freedom of contract. Nevada law provides rules only for those matters on which the parties have failed to agree. The contractual flexibility offered by the Nevada LLC Act is unmatched by any other LLC statute. For example, unlike a corporation, an LLC can distribute profits in any manner described in the LLC agreement, regardless of ownership share. The structure of the LLC does not provide for a board of directors.
Nevada law requires for LLCs to have a registered agent when a company is first formed and throughout its life cycle. The registered agent’s name and address are included in the formation documents. This information is a matter of public record. The registered agent is responsible for receiving important legal and tax documents including notice of litigation (service of process), franchise tax forms, and annual report forms.
There are no statutory requirements concerning meetings of members or record keeping. It is recommended that with two or more members, a members’ agreement be entered into. If meetings are held by members, this may be done anywhere in the world and in any way convenient to the members.
Usually one working day, but we may need up to 10 working days for legalisation of the documents and delivery by courier.
RECURRING MAINTENANCE FEES
As from the second year, there are recurring maintenance fees of $700. These include:
- Provision of registered office and registered address
- Provision of company secretary and registered agent
- Payment of annual government fee
A Nevada LLC does not pay US state or federal income tax if: its owners are not US citizens or Green Card holders; its offices are located outside of the US; or, the LLC does no business in the US. The IRS tax treatment of a Nevada LLC is on a flow-through tax basis; that is, the LLC is not taxed on its profits. The income of the LLC is distributed to its members who are taxed on a personal income basis
Non-resident aliens are not taxable by the US on income derived outside of the US. If an LLC derives its income outside of the US, non-resident aliens do not need to file tax returns.
AUDIT AND ACCOUNTING
A Nevada LLC is not required to file state or federal tax returns. Whilst there is no requirement to file audited accounts or annual returns with the authorities, a company is required to keep financial records, which should reflect the financial position of the company. An annual report is required only in cases where there is distribution of profits to US residents.
Our Services and Requirements
OUR SERVICES INCLUDE:
- Name check and approval
- Filling of the incorporation documents with the the Secretary of State
- Payment of the government fees
- Provision of registered agent, office and address for one year
- Provision of company secretary for one year
- Rubber stamp
- A standard set of original corporate documents:
- Certificate of formation
- Operating agreement
- Action of organiser
- Membership certificate
Please note: If applying for a corporate bank account you will need to order a full set of apostilled company documents when the account is opened outside of the USA.
Please provide the following documents for all directors, shareholders, beneficial owners, and authorised signatories:
- Notarized copy of valid passport.
- Original or Certified copy of utility bill / bank statement (as verification of residential address, dated within three months).
- Original or certified copy of Banker’s reference letter (dated within three months).
- In cases where shareholders and/or directors are corporate bodies, full apostilled set of corporate documents and certificate of good standing (for companies registered more than one year).
IMPORTANT NOTE: LICENSABLE BUSINESS ACTIVITIES
If you conduct any activity without the required license or authorisation granted by a relevant authority in any jurisdiction, Starting Business will not be able to assist you with the company formation or bank account opening related to such unlicensed activity.
Licensable activities include, but are not limited to: provision of financial services involving trading/brokerage in foreign exchange, financial and commodity-based derivative instruments and other securities; offering investment advice to public; insurance and banking; operation and administration of collective investment schemes and mutual funds; payment processing services; money exchange, money transmission or money brokering; asset management; safe custody services; gaming, gambling and lotteries.
Please contact us if you need assistance in the licensing of your financial, Forex brokerage or gambling company.
Shipping of corporate documents or banking kits to your destination requires an extra charge and will be automatically added to your order during checkout. Shipping costs for international courier services are set automatically depending on geographic zones.