Legal Question in Business Law in Minnesota

Re: how to register ecommerce firm when development is overseas

There should be no problem registering the firm here. As a general rule if the work is done outside the US and the source of funds is outside the US you will not have to pay US taxes on it (there are some issues to address, however, under "SubPart F" of the Code relating to foreign-sourced income). If the source of funds is in the US, there may be some taxation but the US tax woul dprobably be minimal if you had appropriate transfer pricing. What I've done on some occasions is have the client set up a US-based firm and an offshore subsidiary or affiliate, with a contract between the two firms to address the appropriate transfer pricing. The US firm would sell the product to its customer taking the price charged to it by the Indian company and adding a modest markup to cover overhead and a small profit. The majority of the profit, should that be the most advantageous, woul dbe associated with the Indian company. I would obviously need to know more about the operational details to get more specific than that; also, I'm not an accountant and the setup would best be vetted by an international tax accountant.

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That said, good luck to you and let me know if I can be of further assistance.