Each U.S. state has its own unique requirements for business registration. In this article, we won’t go over each specific step, but rather focus on the common aspects that need to be considered even before registering a company. Understanding these details can help you avoid many issues that often arise after registration.

Who is Responsible for Business Registration

The U.S. government operates on three levels: federal (the same across the country), state (50 states + 6 territories), and local (city or county). Company registration in the U.S. is handled by state secretariats. Due to the vast differences in laws and regulations for registration and subsequent business operations, it’s essential to rely on experts familiar with the laws of the specific state where the registration takes place. This doesn’t necessarily mean you need a lawyer. Here’s why: each state has its own business regulations, and attorneys are only tested on the laws of the state where they will practice. So, a California-licensed attorney might not know anything about Pennsylvania or Wyoming laws, and a New York-licensed attorney typically doesn’t know or need to know Florida or Washington laws.

In other words, each U.S. state has its own legislative norms, which can vary significantly. This is an important point to consider, as you can’t simply use a registration document package prepared for one state in another.

Furthermore, note that the company registration process in all U.S. states differs slightly from that in European countries. Initially, the company is registered by the state. The process is as streamlined as possible, but it varies significantly from one state to another. The registration process itself, as well as the required documents, differ. In each state, there are unique procedures, steps, and documents that may even have different names.

For instance, in Nevada, before registering your business, you’ll need to provide a List of Officers—a list of names and positions of top managers and company directors. In California, however, this list of company officers (called the Statement of Information in California) is only required after the company is registered. Wyoming, on the other hand, doesn’t require this document at all, though you may still create it yourself and have it notarized for internal company use.

The document package you receive after company registration is known as the Corporate or LLC registration documents.

After registration, the process of forming the company begins. This can be done by an attorney, your nominee director (from our company), or you can do it yourself using corporate document templates provided in a Corporate Kit.

At this stage, we strongly recommend using our attorneys’ services. These documents cover appointing company leadership (top managers), distribution of shares (or interests) among shareholders, stock issuance and transfer records, stock certificates, corporate minutes, shareholder meeting protocols, shareholder agreements, the corporate charter, and other optional documents. Some documents are not mandatory and are created at the shareholders’ discretion. This package is known as the Corporate Kit. This is an internal matter of your private company, and the registration state has no involvement in it, except for the standardized forms and state laws on which they are based. However, without this package, the company isn’t considered fully formed. Depending on the state, this process of forming the company (making decisions and preparing the Corporate Kit) may take anywhere from a month to a year.

Economic Management Features in the U.S.

The economic policy of the U.S. and its states is characterized by the lack of a “power vertical,” meaning that economic development of a particular region depends solely on the competence of its local administration. The economic policy is minimally influenced by the country’s leader (with exceptions such as the Reagan and Trump administrations), and thus reflects unique, locally focused solutions. This leads to autonomy in creating specific laws and regulations for market participants. Washington has no right to regulate state laws; the main requirement is that state laws must not conflict with federal laws.

Due to the decentralized economic power in the U.S., it’s worth noting for future business owners that Washington, as the national capital, is not akin to Moscow or Minsk, where all political and economic decisions for the country are made.

Territorial Independence and Optimal Conditions for Starting a Business

In the U.S., there is no strict territorial binding. This means you are allowed to register your business in one state while operating it in another. This is a critical point concerning tax rates. Some newcomers, out of habit, request to register their business in the state where they have relatives or where they initially stayed. However, they may be unaware of the business conditions in that region. Sometimes, the tax rate is so high that it prevents investment in housing or business development.

As specialists with comprehensive knowledge of business conditions, we will help you select states known for their low tax rates and reduced registration requirements, such as Washington, Wyoming, Texas, Nevada, and California. The latter is a priority for us, as we have successfully established the most companies in that state.

The list is not limited; we can facilitate registration in any state. Each time, specialists based in the specific state with necessary licenses and expertise will be involved. These specialists include lawyers and accountants. Additionally, there will be extensive work with tax authorities. All of these services are paid by you. Therefore, registering and operating a business in an “exotic state” may be significantly more expensive.

Recommendations on Choosing a State for Registration

It is crucial to listen to the advice of experienced professionals in company registration. Such recommendations are valuable as they save time and money—the two most important resources. Therefore, consider our recommendations on selecting an American state to register your business.

1. Consider the tax rate. This factor is particularly important for companies engaged in international trade. In such cases, there is no operational location tie, so you can declare your presence to the administration and tax service of any state. Wyoming and Nevada offer the most favorable tax rates, with a corporate tax rate of 0%.
2. Remember that corporate income taxes vary by state. In Pennsylvania, for example, it’s 9.99%, while in Nevada, it’s 0%.

For more information on corporate income taxes, see the link:

http://taxfoundation.org/sites/taxfoundation.org/files/docs/Corporate%20Income%20Tax%20Rates.png

1. While corporate income taxes can be as low as 0%, sales tax exists in every state. The average sales tax rate ranges from 5-9%. You can read about this mandatory tax in this Wikipedia article: http://en.wikipedia.org/wiki/Sales_taxes_in_the_United_States.

These taxes apply when goods and services are sold in the same state where the company is registered. This means that if you register in California and conduct business there, for example, sending goods to Kazakhstan, you are obligated to pay a combined tax consisting of sales tax (if sold to an end consumer in the state) and profit tax. In the same situation, but registered in Nevada, your company would be exempt from corporate tax as the rate there is 0%. Consequently, your goods become 15-18% cheaper, providing a significant competitive advantage. Learn more about Nevada here: https://usbusiness-visa.com/biznes-v-usa/vedenie-bisnesa-v-usa/kompanii-v-shtate-nevada.

If you’re interested in learning more about taxation in each U.S. state, visit:

https://usbusiness-visa.com/biznes-v-usa/vedenie-bisnesa-v-usa/nalogi-na-korporatsii-v-ssha

Why We Prefer Not to Register in Delaware

Our company has a blacklist of states that are unprofitable or even risky to work with. Delaware is on this list, a state we used to work with, but now we avoid for several reasons. However, if clients insist, we are ready to proceed. Here are some arguments in favor of avoiding Delaware:

• Tax policies in Delaware are unstable, impacted by opportunistic individuals from Kazakhstan and neighboring countries. For example, about 30 years ago, Delaware eliminated taxes, but in 2004, it reinstated them at 8.7%—one of the highest rates in the U.S. Many Kazakhs and Ukrainians sincerely believed (and some still do) that Delaware companies are akin to offshore entities, continuing to register their businesses there. This led to significant issues with unpaid taxes (as business owners believed there were no taxes to pay), resulting in the liquidation of numerous companies and the seizure of their funds as U.S. income.
• You can find accurate information about Delaware taxes here: https://revenue.delaware.gov/frequently-asked-questions/corporate-income-tax-faqs/
• Due to its high tax rate, Delaware is considered an expensive state and not very business-friendly. New York follows a similar approach.
• Delaware imposes strict requirements on practicing attorneys; anyone wishing to work in the state must pass a bar exam specific to Delaware. Due to the unique legislative framework here, passing this exam is challenging, and as a result, these attorneys charge high fees, averaging $650 per hour. A wealthy investor can afford such an attorney, but for most, this is not feasible. Who do you think will win a court case in such a scenario?
• Delaware mandates a corporate document package (in addition to registration), costing $1,500, which goes to Delaware attorneys. Skipping this process to maintain anonymity can have consequences—you could lose your company in court with minimal chance of a favorable outcome.
• The state’s legislation is highly investor-friendly. If an investor acquires even a minor stake in your company, the situation may not work in your favor. Delaware law and courts generally side with shareholders, not the company management. A skilled attorney could easily strip you of your own company, transferring ownership to that investor. This is why investors often insist on Delaware incorporation.

If you are inexperienced in business registration and management, you may make the wrong decision and a serious mistake by choosing, for instance, New York or Delaware as your registration location. These are the most complex city and state in every way: a vast amount of paperwork, high late fees, and separate reporting requirements for the city, state, and federal authorities. These conditions create a challenging environment for a novice entrepreneur.

Registration and Business Management Services

When seeking assistance with business registration and legalization in the U.S., you should remember that our company specializes in business management services. This means that after registering your company, we will enter into a service agreement with you, and we will handle the business management—i.e., support—of your company. If you do not register or purchase a company through us, we do not offer ongoing support services. So, weigh the pros and cons of working with us and make the right decision for you.

If you do trust us, you can rest assured that we will take on all problem-solving responsibilities. Due to variations in state laws, there are indeed many challenges. For example, after successfully registering, obtaining all necessary licenses and certificates, and starting operations, your company begins to generate profits. At this point, you face obligations to submit regular reports to tax authorities. You will encounter issues specific to reporting requirements in different states: Florida requires one set of documents, while California requires another. In addition to state-level reports, there is also federal reporting. You may also need to address federal tax matters and other ongoing business management issues.

Opening a Corporate Bank Account in the U.S.

If you have registered a business in the U.S., you will need a corporate bank account to operate. This account is essential for establishing proper relations with various branches of government and fiscal services—immigration, tax authorities, and state administration. Not having a U.S. bank account or IRS registration after starting a business suggests an illegitimate status or a lack of real business activity. This in itself signals to local and federal authorities that you may be engaged in illegal activities or tax evasion. Our company does not work with such firms because we do not want to share responsibility with the company founders and directors for money laundering, financial diversion, or other unlawful actions.

Account opening is only possible with a company director who is a U.S. citizen or permanent resident. We provide you with a nominal director who registers your company with the IRS and obtains an Employer Identification Number (EIN), which is required to open an account with any financial institution in the U.S. Our company registers only those businesses that register with the IRS and open corporate accounts in American banks.

Tax Compliance

Timely tax payment for all types of operations is essential for the long-term success of a business. Accidental or intentional tax evasion is punishable by law. The U.S. has an extensive set of laws that target money laundering, tax evasion, and even terrorist financing.

While certain U.S. states like Nevada, California, and Texas welcome new businesses, they are very strict with lawbreakers and tax evaders. Law-abiding entrepreneurs are always welcomed, as they create jobs, contribute to state revenue, and foster the development and stability of the region's economic and social structure.

Our company has been working with new business owners for 18 years, gaining extensive experience in dealing with all branches of government and tax authorities. We have earned a reputation for reliability, and we only work with legitimate businesses and responsible entrepreneurs.

Steps for Registration

If you wish to benefit from our company's experience and reputation, here are the steps to follow:

1. Complete the registration form.
2. Specify your preferences in the application.
3. Discuss your business direction with our manager and get recommendations for selecting a state.
4. Our representative issues an invoice.
5. You pay the invoice.
6. We complete all necessary steps for your company’s registration.

Founding Documents

As mentioned earlier, each state has its own laws and requirements for business documentation, including the type and content of founding documents. A document package prepared for Texas may not be valid in California.

Mandatory data in founding documents typically includes the Articles of Incorporation, EIN (Employer Identification Number), business license number (in Nevada), and so on. All identification numbers, regardless of document content, must be included in the state’s databases.

Furthermore, electronic documentation has long been a standard in the U.S. All registration documents are digital. The main requirement is that your company’s registration is recorded in the state’s database. From there, records are shared with various local and federal agencies. The number of printed copies of your documents is up to you, but they hold little significance in the U.S. In all business operations, the primary source of information about your company is the electronic database, and printed copies serve merely as references for locating you in these databases. The concept of an “original copy with a blue stamp” simply doesn’t exist in the U.S.

We can provide you with notarized or apostilled copies, authenticated by the state secretary if needed.

Seals in the U.S. do not carry the same weight as they do in Kazakhstan or Ukraine. In the U.S., a seal does not authenticate a signature, but if having a seal on documents is important to you, we can have one made for you.

In the U.S., all companies are registered either online or by mail. There are no counters, no lines, no official stamps. This process simply doesn’t exist, except perhaps in very remote states, with which we do not work. Furthermore, business registration is administrative, not permit-based. Some clients say they want to be present for the company registration. That’s fine, but we can’t offer you any kind of tours of counters or government offices. At most, you’ll be actively checking your email from your hotel room…

The registration process concludes once all of your company’s registration data appears in the state administration’s database. Only then can we consider our work on your business registration complete and your business legally established.