In Which State Should I Incorporate?

Most small businesses are better served by incorporating in the state where they do business. However, before deciding in which state to form your corporation, consider the following:

Fees – A number of taxes may be charged in connection to incorporation. Verify if the state you are considering charges income tax, sales tax, and/or franchise taxes.

Business laws and statutes – States incentivize business in different ways. Decide if the incentives are worth the extra cost and effort of registering as a foreign entity and paying Registered Agent fees. If you are conducting business in another state, you will likely have to register there anyway and pay any relevant taxes.

Requirements to qualify as a foreign entity – Choosing to incorporate in a state other than where your office is located and doing business requires qualifying as a foreign entity. These requirements may be prohibitive and should be reviewed before making a decision.