Legal Question in Business Law in Texas

I want to strike out on my own for doing software and electronic engineering. This is Texas. I have a friend in Colorado who had been established an LLC and then does taxes via a S-Corp type of tax plan. I am wondering where to get started but haven't found any specific books on the subject. Another thing I've seen mentioned all over the web is that I might want to incorporate in either Delaware, Nevada or Wyoming as they are all more business friendly. I am thinking I might need a CPA or lawyer but my friend in Colorado said he managed to pull it all off by himself?


Asked on 1/10/10, 6:34 am

1 Answer from Attorneys
Alex Davis A.L. Davis Group, PC

You can pull it off by yourself, but there are always issues that a lawyer can help you with that can save you a lot of headaches in the future. Such as, I always advise my client not to file as an S-Corp. You pay taxes based on what you earned as a business not by what you pay yourself. I.E. if you make 350 but only take 100 for yourself your tax is still based off the 350 plus you pay taxes on money not yet earned with S-corp. As far as which state to incorporate in I would say texas. If you incorporate in say DE but your business is in Texas you are going to have also file also as a foreign corporation in Texas that is an additional cost for not much additional benifits of filing in DE.

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Answered on 1/15/10, 8:44 am


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