Filing in a state that you aren't yet doing business has no benefit and could actually hurt you.
By registering in a state you are consenting to being sued there. Why would you register a Delaware (or elsewhere) LLC when you are in California. Bad idea.
Second, if you don't register in your home state it could be found that you aren't operating an LLC at all. Say hello to personal liability for your debts.
Register in your home state, and as you expand to operations/contacts in other jurisdictions, register there.
What are you basing your opinion off of? Almost every law textbook would disagree with you.
There are three states where LLCs are commonly formed: Delaware, Nevada, and Florida. VCs, accountants, and lawyers are all familiar with the laws in these states, which are well-established and friendly to small businesses. This means that any disputes are likely to be resolved faster and cheaper in court should they ever arise.
The only downside is that you might have to register the out of state LLC in your state, and depending on the state, you may have to pay some extra taxes. But the benefit of filing a well-known LLC is far worth the hassle.
Comments
No.
Filing in a state that you aren't yet doing business has no benefit and could actually hurt you.
By registering in a state you are consenting to being sued there. Why would you register a Delaware (or elsewhere) LLC when you are in California. Bad idea.
Second, if you don't register in your home state it could be found that you aren't operating an LLC at all. Say hello to personal liability for your debts.
Register in your home state, and as you expand to operations/contacts in other jurisdictions, register there.
What are you basing your opinion off of? Almost every law textbook would disagree with you.
There are three states where LLCs are commonly formed: Delaware, Nevada, and Florida. VCs, accountants, and lawyers are all familiar with the laws in these states, which are well-established and friendly to small businesses. This means that any disputes are likely to be resolved faster and cheaper in court should they ever arise.
The only downside is that you might have to register the out of state LLC in your state, and depending on the state, you may have to pay some extra taxes. But the benefit of filing a well-known LLC is far worth the hassle.