Why Form an LLC in Nevada?

By Anna Assad

A Nevada limited liability company (LLC) is a business organizational structure that blends the legal aspects of a corporation and partnership. The owners, known as members, of a Nevada LLC have personal asset protection from creditors of the company under state law, but other benefits exist, especially if the LLC primarily conducts business in the state.

A Nevada limited liability company (LLC) is a business organizational structure that blends the legal aspects of a corporation and partnership. The owners, known as members, of a Nevada LLC have personal asset protection from creditors of the company under state law, but other benefits exist, especially if the LLC primarily conducts business in the state.

Tax Savings

The members of an LLC formed in Nevada do not pay personal income tax on profits received from business conducted in the state, as Nevada does not have personal income taxes. Profits made in another state may be taxable in accordance with the state's tax laws. No gift, inheritance or admission taxes, or taxes on tickets to the public for places like amusement parks, are levied in Nevada. Nevada does not share information about LLCs to the Internal Revenue Service, the government agency responsible for the collection and enforcement of federal taxes.

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Minimum Requirements

The minimum requirements to form an LLC in Nevada are less restrictive than those found in other states. The members of the LLC do not have to live or conduct meetings in Nevada, and the LLC paperwork may be filed by phone, fax or mail. No annual business meetings are required and the LLC does not have to draft an operating agreement, although doing so provides a plan for the company's management. Nevada laws favor the operating agreement and generally permit the agreement's provisions to oversee the internal procedures of the LLC.

Asset Protection

Nevada laws do not allow a creditor to attach a standard money judgment to the interest of an LLC member. The creditor may be able to obtain a court "charging order" allowing the creditor to place a lien on the profits that the LLC member is entitled to receive.

Privacy

Nevada law is geared toward protecting the privacy of individuals engaged in business. The names and addresses of an LLC's board members are not a matter of public record, as no requirement for the public naming of the individuals exists in state laws as of 2010.

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LLC Minutes Requirements

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Advantages of Forming an LLC in Nevada

A limited liability company (LLC) is a form of business organization that offers limited liability and no double taxation of company distributions. An LLC is governed by the law of the state in which it was formed, and every state has its own set of LLC laws. Nevada LLC law offers certain unique advantages to LLC members.

Benefits of a Limited Liability Company

Limited liability companies (LLCs) offer several benefits because they share characteristics with several types of business entities. LLCs have similar characteristics to partnerships, corporations and sole proprietorships. Because of these shared characteristics, LLCs offer flexibility on a number of issues important to business owners. While state laws vary for LLCs, the same principal benefits typically apply from state to state.

What Is the Structure of an LLC?

State law dictates how you can form a limited liability company business entity and the structure it must maintain to retain its LLC status. Most jurisdictions throughout the nation have similar structure requirements. However, for federal tax purposes, the IRS allows an LLC to elect the tax treatment of a corporation.

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