Is Delaware the cheapest place to incorporate? • Hacker News Board

Re: Is Delaware the cheapest place to incorporate?

#71

Post by wernercd » Fri, Nov 17, 2023, 1:49 AM UTC

adastra22 wrote: post #62

jawns wrote: post #60

Earlier quoted context omitted.

I'm a longtime Delawarean and in my past life as a journalist I wrote about why the state is such a corporate haven. The short answer is that companies incorporate in Delaware to mitigate risk. The slightly longer answer is that the Delaware courts that deal with corporate legal matters are much more predictable than comparable states. There is voluminous settled case law, and so when you incorporate in Delaware, it…

I mean it is because everyone else is doing it. Because everyone else incorporated in Delaware, that's where the case law is well established, all existing contracts are written in terms of DE corporate case law, etc. etc. We all could have picked Road Island or New York instead. But for historical reasons it was Delaware.

How is that any different than anything else?

Everyone hates Facebook but everyone uses it. Why? That's where the people are. Same for Instagram, Reddit, etc.

Everyone hates JavaScript. Buggy and counter intuitive. Mess in all the different browsers - historically. But everyone uses it because everyone uses it so it gets the community.

Maybe Delaware is the best... or a victim of circumstance. Or being good enough and one of the early states to get that foot hold.

Re: Is Delaware the cheapest place to incorporate?

#72

Post by oldtownroad » Fri, Nov 17, 2023, 1:52 AM UTC

ValentineC wrote: post #69

KieranMac wrote: post #38

I'm an attorney. Delaware is definitely not the cheapest or even in contention for the cheapest. Still, if you want to raise capital, the correct answer is DE C Corp. If you're not looking for external funding, any state will do. If you care about anonymity, do Nevada or Wyoming. If you don't care about anonymity, Colorado is actually a very good choice. Very simple, intuitive online filing system that accepts filing…

Piggybacking on this. If I'm a non-resident alien looking to incorporate the cheapest US-based company so that I can open a business bank account for credit card churning, would a Colorado LLC still be the the best choice for me?

You’ll need an SSN to open most credit cards, it’s very difficult to get a credit card without residency. The business banks that specifically cater to overseas founders (like Mercury) make banking easy but that doesn’t extend to churning credit cards.

Edit: put simply, it’s very unlikely that opening an LLC will help you in obtaining credit cards as a non-resident.

Re: Is Delaware the cheapest place to incorporate?

#73

Post by jake_morrison » Fri, Nov 17, 2023, 1:54 AM UTC

ddxv wrote: post #6

mytailorisrich wrote: post #5

How is it in Taiwan? I know nothing about it and the paperwork involved, but a quick search [1] suggests that the fee is NT$700, or about US$22, which does not sound expensive. [1] https://bizportal.moea.gov.tw/showPageEngDetail?search=16

Thanks for asking the obvious, which I hadn't though of yet. I've only heard fairly negative things about incorporating in Taiwan, but I don't know the specifics, and am unclear how much is repeated bias. I wil ask people who know more to explain that to me.

I am an American who has worked with startups in Taiwan for 30 years. I am happy to talk.

Re: Is Delaware the cheapest place to incorporate?

#74

Post by gigatexal » Fri, Nov 17, 2023, 1:59 AM UTC

Thank you for asking this question OP! The discussion has been really interesting. And good luck with the startup! Hope to see it on a Show HN soon.

Re: Is Delaware the cheapest place to incorporate?

#75

Post by [deleted] » Fri, Nov 17, 2023, 2:00 AM UTC

oldtownroad wrote: post #72

ValentineC wrote: post #69

Earlier quoted context omitted.

Piggybacking on this. If I'm a non-resident alien looking to incorporate the cheapest US-based company so that I can open a business bank account for credit card churning, would a Colorado LLC still be the the best choice for me?

You’ll need an SSN to open most credit cards, it’s very difficult to get a credit card without residency. The business banks that specifically cater to overseas founders (like Mercury) make banking easy but that doesn’t extend to churning credit cards. Edit: put simply, it’s very unlikely that opening an LLC will help you in obtaining credit cards as a non-resident.

[deleted]

Re: Is Delaware the cheapest place to incorporate?

#76

Post by yieldcrv » Fri, Nov 17, 2023, 2:10 AM UTC

KieranMac wrote: post #38

I'm an attorney. Delaware is definitely not the cheapest or even in contention for the cheapest. Still, if you want to raise capital, the correct answer is DE C Corp. If you're not looking for external funding, any state will do. If you care about anonymity, do Nevada or Wyoming. If you don't care about anonymity, Colorado is actually a very good choice. Very simple, intuitive online filing system that accepts filing…

note: nevada lets you form entities with little information but demand the information 6 months later, which will be public

the only shady thing about this part of nevada are all the promoters advertising anonymity

Re: Is Delaware the cheapest place to incorporate?

#77

Post by Projectiboga » Fri, Nov 17, 2023, 2:30 AM UTC

B A big new issue is you now need a separate Delaware address from the address of your registered agent. This now pushes the annual costs up some.

Re: Is Delaware the cheapest place to incorporate?

#78

Post by NotYourLawyer » Fri, Nov 17, 2023, 2:32 AM UTC

fragmede wrote: post #63

KieranMac wrote: post #38

I'm an attorney. Delaware is definitely not the cheapest or even in contention for the cheapest. Still, if you want to raise capital, the correct answer is DE C Corp. If you're not looking for external funding, any state will do. If you care about anonymity, do Nevada or Wyoming. If you don't care about anonymity, Colorado is actually a very good choice. Very simple, intuitive online filing system that accepts filing…

How difficult is it to change, in practice? If I've got an LLC or a corp in a different state, can I form a DE C corp and arrange to have that buy my whatever?

It’s not a big deal. Startups do this all the time when they get bigger and want funding.

Re: Is Delaware the cheapest place to incorporate?

#79

Post by etothepii » Fri, Nov 17, 2023, 2:37 AM UTC

ska wrote: post #55

It probably matters most what your aims are for forming the company. Since you are proposing it will have low to no revenue, what is driving you to (think about) incorporating?

The real reason to incorporate surely is the limit on liability and the ability to treat assets and actions of the project as distinct from your own.

Accidentally infringe a copyright it is probably 1000x harder to cause the owner of a company grief tan it would be to devistate the life of a sole-trader.

Re: Is Delaware the cheapest place to incorporate?

#80

Post by jalapenos » Fri, Nov 17, 2023, 2:40 AM UTC

Why do you need a company for such an initiative? Why not just make it?

Also setting up a company in another country than the one you live in, compliantly, introduces a world of bureaucratic hurt. If you have a good reason to set up a company, far easier to set up a local one.

Not a lawyer/accountant.