When it comes to starting a business, Delaware has been one of the leading states for more than 100 years. Delaware hosts more than 1 million businesses. 63% of Fortune 500 companies also are in Delaware. Last year, people started more than 145 companies in Delaware, and 70% of these businesses are LLCs.
One of the main reasons why companies choose Delaware is that its laws are improved continuously to provide companies with stability and flexibility.
Corporate laws in Delaware decide the legal frame for the internal affairs of companies. The High Court in the state, on the other hand, is famous for its quick and equal approach to essential and complex conflicts. Delaware Division of Corporations is also renowned for its professional approach to corporate clients.
Delaware’s corporate law system attracts many companies around the world. Delaware Division of Corporations functions as a company rather than a government body to fulfill the complex needs of its clients. Delaware Division of Corporations, for the first time, started a paperless, online and expedited service in the U.S.
Division of Corporations which is open until midnight four days a week to fulfill the needs of its clients, and it is certified ISO-9001. Companies pay their franchise tax and several application fees adjusted to be competitive with other states.
The Director of the Delaware Division of Corporations Rick Geisenberger says: “Delaware is a state which devotes itself to a business-friendly atmosphere.”
Starting a company in Delaware does not mean conducting secret and illegal activities or avoiding paying taxes. Just as other states, Delaware has legislation and tax obligations. Companies in Delaware have strict reporting responsibilities. All these obligations are a part of Delaware’s devotion to corporate transparency.
Delaware Department of Revenue is responsible for collecting tax and income information from company owners, partners, directors or other individuals related to the company operating within the State.
Companies started in Delaware are also responsible for federal tax laws and application requirements. The U.S. Federal Government follows ownership information via Tax ID applications, annual tax returns or financial account reports. Profitable ownership in the U.S. is regarded as tax information, so it is subjected to strict confidentiality and can only be accessed by authorized people or organizations.
Just as in other states, companies must state some ownership information (name and address of the owners) in their franchise tax report. Incorporation applications and annual franchise tax reports are public records.
Delaware passed the “registered agent” law in 2006. Thanks to this law, courts and Delaware Division of Corporation started to have more authority over fraudulent activities of corporate service providers. Each business authorized to operate in Delaware has to give the name and address of a contact person to their registered agent, and their registered agent has to keep this information.
With the rising worries about starting “shell companies” to avoid legal investigation Delaware started new standards (in 2012) aiming “shell companies” and incorporation agents which advertises “anonymity and confidentiality.” In the year, the state has put new legislation into effect which forces companies to choose their directors within the first year of incorporation.
The idea behind this was to avoid fraudulent activities by allowing directors, investors and legal bodies access the records of the companies in Delaware to examine them.
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