A USA LLC offers many of the benefits of a “tax haven” company without attracting the kind of suspicion that a known tax haven company can sometimes arouse.
In 1988 the US Internal Revenue Service ruled that LLCs would for taxation purposes be treated the same as partnerships. (The profits of a partnership are not taxable – the profits are paid to the partners who are then responsible for any tax obligations that may arise from that receipt). Hence an LLC is a flow through entity and pays no tax in the US on the income it derives.
Instead of shares an LLC has “membership units” and its day to day business is overseen by a “Manager” (equivalent to a Director).
An LLC is also an excellent alternative to a partnership as it enables you to limit your liability (whereas partners in a partnership remain jointly and severally liable for the debts of the partnership).
An LLC is most useful when used in combination with an IBC (ie where the IBC owns the LLC). This can enable you to discreetly do business in the name of an American Company and to pass through all the nett profits (free of tax in the US) to a nil tax entity ie the IBC. The advantages of this should be obvious:- ie you achieve the same result as if a nil tax Offshore Company (eg IBC) had been used but without attracting the kind of suspicion or negative connotations that trading in the name of an IBC might otherwise give rise to.
Key features and benefits include:
- Zero Tax: Provided the members of the company are not US residents and provided the LLC does not operate in, have offices/staff in (and does not undertake any business activity that is effectively connected with business or trade within) the US then there is no US tax liability
- Discreet: States of the US that offer LLC incorporation are not perceived as being “offshore” jurisdictions
- Low annual cost: Despite the well regarded location US LLC states’ annual government charges are amongst the lowest of all tax haven jurisdictions
- Privacy: There is no public register of LLC managers, members or owners and in most LLC states/jurisdictions there is no obligation on the LLC formation agent to keep records of the underlying beneficial owners of an LLC. Nominee members (shareholders) can also be supplied as a further privacy safeguard.
- Flexibility: LLC´s can own and operate a wide range of businesses as of right and can even be used as blue-ribboned operating entities within the EU (by registering them to trade with the respective government departments)
- Choice of Location: We offer LLCs incorporation services in the states of Delaware, Colorado, Arkansas, Nevada, Wyoming, Oregon and New Mexico on account of their privacy laws, low annual charges, speedy incorporation service and operating flexibility (Colorado, Oregon, Arkansas and New Mexico are newer LLC jurisdictions and are not often considered “Offshore” centres).
Other features include:
- Usually only one member is required
- Most LLC states offer speedy online incorporation
- Excellent communications
- Ideal for use as owner of a website
- All documents are created (and communications are carried out) in English
- Very Politically stable
- Requires fewer Corporate formalities such as annual meetings and record keeping
- There is usually no requirement to hold member’s meetings and any meetings that do take place can be held anywhere in the world
- An LLC may be managed by the company’s members, and in most states the members of the company may appoint non-members (eg Nominee Directors/Manager/s) to oversee the day-to-day operations of the business.
Price (all inclusive): $US
Delaware $US 750
Arkansas $US 650
Oregon $US 650
Colorado: $US 650
New Mexico $US650
Wyoming: $ 750
Nevada: $750
With tax effective offshore company management (ie including Professional Corporate “Nominee” Director, Shareholder & Company Secretary):
Delaware: + $800
Arkansas: + $800
Oregon + $800
Colorado + $800
New Mexico: + $800
Wyoming: + $800
Nevada: + $800
New Mexico LLCs
A Relative newcomer to the LLC market the New Mexico LLC is attracting a lot of interest on account of its unparalleled privacy features. (Principally, ownership information does not have to be revealed at registration and there is no requirement to file an annual return).
And as typical with an LLC a New Mexico LLC is treated by the American Tax authorities as a partnership for tax purposes ie provided all income is distributed to members by years end the LLC is not liable to for tax either in New Mexico (“NM”) nor to the US Federal tax authorities.
Prime features of the New Mexico LLC Include:
1. Low Cost: New Mexico has the lowest government filing fees in the US for an LLC
2. Low Maintenance: There is no requirement to file an annual report.
3. Easy of set up: The Company can be incorporated simply by filing Articles of Organization.
4. Privacy: A nominee can be listed in the Articles as Organiser
NEW MEXICO LLCs BENEFITS
New Mexico LLCs offer distinct benefits:
- · One-time filings
- · You only need to form the LLC in New Mexico. There is no other government maintenance or licenses to file after you complete the Articles of Organization.
- · There is no disclosure to the authorities of owners or managers details
- · The address at which company records are to be kept (“ie the “Principal Business Address”) can be anywhere in the world
- · New Mexico LLCs do not have annual reports.
- · Low government fees
- · A NM LLC may be managed (ie Directed) by either a member or non-member manager.
- · A NM LLC may be managed/directed by another LLC/Company.
- · Simplicity No annual reports needed and simple Articles of Organization requirements.
- · Asset Protection – New Mexico has some of the best limited liability coverage for an LLC (explained in depth below), especially when it comes to protecting LLCs from other members.
THE UNIQUE ADVANTAGES OF A NEW MEXICO LLC
Forming a limited liability company (LLC) in the state of New Mexico has unique advantages: simplicity of operations, federal and state tax exemption, protection of your assets from personal liability, and ease of raising capital with no investor ceiling. A New Mexico LLC combines the taxation benefits of a sole proprietorship or partnership, and the limited liability of a corporation, for the best of both worlds. New Mexico LLC formation is regarded as a separate legal entity, with the advantage of protecting the owners from business liability.
Simplicity
A New Mexico LLC is uniquely flexible and simple to form. The cost is low, and maintenance is minimal. The LLC has the advantage of setting its own policies on corporate governance such as: capital or asset contributions by the members; taxation planning; accounting model; recordkeeping and minutes-keeping; frequency of member meetings; management structure; officer appointments; buy-out provisions; management rights, duties and obligations; date of LLC dissolution; and resolutions, voting rights or operational duties and requirements.
Tax Exemption
A Mexico LLC is tax-exempt under state and federal law. It has the advantage of taking the limited liability features of a corporation and combining them with “flow-through” tax benefits of a sole proprietorship or partnership. Your business losses, profits and expenses flow through the company to the individual members to avoid being taxed on both a corporate and individual level. Your LLC corporation has the flexibility of setting its own dividend policy, rather than having to follow mandatory distribution of earnings on a dollar-per-share basis.
Asset Protection
A New Mexico LLC offers the unique advantage of the same benefits of asset protection as Nevada corporations and offshore entities, without the premium prices and high maintenance fees. Under the LLC, your personal assets are separated from corporate liability and any potential future creditor action. To protect your privacy, only the following are required for the Articles of Organization: the name of the company and the address of the principal office; the name and address of the registered agent; and the duration of the LLC. Membership interests may not be seized to satisfy a creditor’s claim against the member. This is due to a statutory provision known as “charging order protection”. The creditor can only receive the right to allocations of profit and loss that the member would otherwise receive. However, a properly worded LLC Operating Agreement will allow for profits to be retained within the company and “expensed out” or funneled to the member via alternative means (such as LLC management fees.)
Unlimited Investors
The advantage of raising capital for a New Mexico LLC is that any number of investors can contribute, including individuals, trusts, pensions or even other LLC corporation entities, unlike a sub-chapter S corporation, which is limited to 75 shareholders. By building your capital base and with an operating history, you have an advantage in securing various credit facilities.
OCI New Mexico Incorporation Packages
At OCI we believe in giving you more for your money than would the average IBC formation service. Hence included in the incorporation package for your New Mexico LLC is/are the following:
Services:
§ Unlimited name availability inquiries
§ Advice from an experienced International Corporate Lawyer on how to structure your company
§ Preparation (overseen by a lawyer) of application to incorporate the company
§ Preparation (overseen by a lawyer) of the company’s Operating Agreement
§ Preparation (overseen by a lawyer) of the company’s Articles of Organisation
§ Attending to filing incorporation request with the company registry
§ Attending to payment of government filing fees
§ One year’s Registered Agent service in the country of incorporation
§ One year’s Registered Office service in the country of incorporation
§ Mailing address in the country of incorporation
§ Delivery of Incorp pack by international courier (ie DHL/Fedex/TNT etc)
§ Unlimited free legal consultations for 12 months with our In House Lawyer ( call us anytime at no cost for advice on how to structure/document transactions, how to administer your Company, how to move money, compliance requirements etc)
Documents included in your Incorp pack:
§ Certificate of incorporation
§ 2 sealed/stamped copies of the company’s Operating Agreement
§ 2 sealed/stamped copies of the company’s Articles of Organisation
§ Resolution appointing first Manager
§ Resolution appointing first Members
§ Up to 5 Membership Unit Certificates
§ Resolution to open a bank account
§ Resolution to rent an office
§ Resolution/s to engage a Phone, Internet & Website service provider
§ Resolution to hire a staff member/s
§ Resolution to appoint a company lawyer
§ Resolution to appoint a company accountant
§ Resolution appointing you as the company’s authorised representative in commercial negotiations
§ Resolution issuing a Power of Attorney in your favour
§ Agreement authorising you to represent the company in commercial negotiations
§ Power of attorney authorising you to sign documents on behalf of the company
§ Register of Managers
§ Register of Members
§ Expression of wishes (ie an “Offshore” Will)
§ Lawyer authored User Guide (“How to Use Your Offshore Company”)
And
Price (all inclusive): $US $650
With tax effective offshore company management (ie including Professional Corporate “Nominee” Director, Shareholder & Company Secretary): $ 1,050
From 2nd year costs $450 (+ $400 if Nominees are required). Included in the annual fee from 2nd year are the following services:
§ Attending to payment of government filing fees
§ One year’s Registered Agent service in the country of incorporation
§ One year’s Registered Office service in the country of incorporation
§ Mailing address in the country of incorporation
§ Delivery of Incorp pack by international courier (ie DHL/Fedex/TNT etc)
§ Provisions of New Mexico business address
§ Attending to and updating the Directors register
§ Attending to and updating the Share register
§ Attending to and updating the Asset register
§ Recording details of any changes to Directors or Shareholders
§ Unlimited free legal consultations for 12 months with our In House Lawyer ( call us anytime at no cost for advice on how to structure/document transactions, how to administer your Company, how to move money, compliance requirements etc)
Note if you order an LLC plus an IBC at the same time you automatically qualify for a 5% discount off the total set up price.
If you’d like to know more about USA LLCs please Contact Us
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Every effort has been made to ensure that the details contained herein are correct and up-to-date, but this does not constitute legal or other professional advice. We do not accept any responsibility, legal or otherwise, for any error or omission.
