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Old 7th April 2008, 10:08 PM   #1
Roark
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Question LLC - Different State Blues

Hello All,

I have written some software that I would like to sell exclusively on-line. To protect my own assets, I wish to open an LLC that will sell the software for me. In my research, I have found that a few states offer a friendlier business climate than others. That is, some states would probably offer more protection to me, as well as a lower cost of doing business.

If I were to follow the plan of opening an LLC in another state, I know that my own state would eventually want me to register my LLC as a "Foreign Entity," but that would only happen if I established a local presence, I am told.

My question to you is: What would be considered "a local presence?" Would opening a local bank account for my distant LLC be considered "a presence?" Would the fact that I happen to live in my own state be considered "a presence?" Or is "a presence" strictly doing business in my own state, such as setting up a store?

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Roark

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Old 8th April 2008, 08:47 AM   #2
Tom Young
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Quote:
Originally Posted by Roark View Post
Or is "a presence" strictly doing business in my own state, such as setting up a store?
Roark
Or setting up a shipping location such as from where you actually ship your software to fill orders.

Tom

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Old 8th April 2008, 01:10 PM   #3
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Hello Tom,

I appreciate your post.

Fortunately, I will not be shipping my software. It will be available for download on-line as a trial, and the same trial can be activated as the final product.

Do you believe any of the other scenarios that I have listed would be considered a local presence? A bank account, standing in my own state, but answering an e-mail, etc.?

Thanks,

Roark

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Old 8th April 2008, 04:35 PM   #4
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You may be able to get situation specific help from http://score.org where information is free and confidential.

Tom

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Old 8th April 2008, 05:07 PM   #5
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Thank you, Tom. Score is a very good tip. I was not aware of their services.

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Old 8th April 2008, 10:54 PM   #6
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I live in Nevada, which is very business friendly. To do business in Nevada you need a resident agent, if you have no presence in the state. The fees for an agent start at about $40 per year depending on what services you also need.

The URL for the business center for the Secretary of State is http://www.sos.state.nv.us/business/ This has most of the info you need.

To register an LLC I think it is $125 + $75 for the first year, and maybe $125 thereafter. http://www.sos.state.nv.us/business/...Domesticpk.pdf

Apparently a big NY taxi company has formed an individual Nevada LLC for every 2 taxis. That way if there is a problem or liability with a taxi only that 2 taxi LLC is liable.

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Old 8th April 2008, 11:04 PM   #7
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Thank you kindly for the information and links, Jaairey. I think the 2 taxi idea is pretty clever.

Roark

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Old 25th February 2009, 05:57 PM   #8
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Roark, just an FYI, as the owner of the business, you'll create nexus in your state of residence for the LLC.

IE, your status as the guy running the show will put you on the radar screen.

Also, if you state taxes your income (and it probably does) your LLC will appear on your federal tax return and so need to be included with your state return, too. An LLC is (by default) disregarded as an entity separate and apart from its owner.

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