Any individual or business may form an entity in another state. There is nothing illegal or immoral in doing so. The popular perception from the media is that there is something illegal going on when an entity is formed in another state. The reality is quite different than what many would think.
We are located outside of Buffalo, NY. We have clients that are incorporated in Delaware, Nevada, Florida, and Wyoming. All of those states are friendly to businesses. From a taxation standpoint incorporating in those states serves no purpose because they still have to file tax returns in whatever states they do business. So every one of our clients who is incorporated outside of NY still files NY tax returns because they are doing business in NY. Some of our clients also do business across the border in PA so we have to file taxes there also.
So why incorporate or form an LLC in other states? Quite simply, less regulation. Pretty good reason for many businesses.
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