Legal Question in Business Law in New Jersey

Re: LLC in Delaware Ok?

What type of consulting business do you have? Depending on the type of business, you may want to be a NJ LLC since that is your residence. Nevertheless, if you are in an infomation service, that is subject to sales tax in NJ, and you may consider a different business location.

Please look at my website:

http://www.taxesq.com

for more information.

I hope this helps!

Ron Cappuccio

Re: LLC in Delaware Ok?

The question that I have is why do you want to set up a Delaware LLC. If this were a corporation and you had the intention to go public, DE might make sense. However, an LLC is a different matter. Some accountants do DE out of force of habit. My experience is that the "canned" DE LLC papers are terrible. They mostly replicate what a corporation would do and give away all of the advantages of an LLC. So, consider registering the LLC in the State in which you have your main office.

The State of formation and the places in which you are registered to do business are different. Formation is an legal construct and there can be only one State of formation (although affiliates can be formed elsewhere). In addition, the laws of most States and foreign countries require that an entitly register with the government if "doing business" in the jurisdiction. The purposes are twofold (1) to assess taxes (2) to have a designated place for service of process. There is a body of case law defining "doing business". Just filling orders or sending ads into a State is not doing business in the State. Having an office with employees is. Most things fall between these.

In a personal service business like consulting, most of the time you should be registered to do business in the State in which you reside.

I hope that helps. If you want to discuss the issues further, call or email.

See also" http://info.corbettlaw.net/lawguru.htm