FAQ – Frequently Asked Questions
Please find below a list of the frequently asked questions:
Founding location: Florida
Florida deserves its official name, “The Sunshine State.” It’s just a beautiful, sunny paradise… and therefore the ideal place for founding a corporation. Fees are low, you can found a corporation as an individual and stay anonymous as the company founder.
The risk of making you personally liable for your business activities as the owner of your company, is practically zero in contrast to most European forms of enterprise. A liability exemption can already be established for owners and directors of a US corporation in the founding bylaws. Piercing the corporate veil, i.e. owners being personally liable although the form of enterprise would exclude this, is not common for corporations at all, as long as the corporation pays its taxes and does not vioalate the law.
Business Purpose of a Corporation
The Corporation is just the right company form for many different business activities. The main business areas in which a Corporation works are registered under “purpose clause” in the letters of corporation. There is no further notification requirement to the authorities does not exist. A so-called “general purpose clause” allows the Corporation to have generally all forms of trade that can be operated without special permission in the US.
Name of corporation
You basically have free choice regarding the name of your corporation, unless the requested name is already registered. You may also use this name for subsidiaries, branch offices, plants, or limited partnerships with limited liability companies as general partners.
Who can form a US corporation?
Any natural and legal entity can form a corporation in the US – disregarding residence and nationality. You nevertheless need a Registered Agent in order to found your company. The founder of the company does not have to travel to the US in order to establish his or her company.
Forming a Corporation
One of the first steps in forming a US corporation is formulating the Articles of Incorporation. You provide brief information about the company to be founded, such as: name of corporation, principal office, information about its capital assets and general information regarding the purpose of the company. Then the company is officially registered with the CorporationBureau. Bylaws need to be created, stating detailed information about the company. The compan’s management is determined. In addition, a tax number needs to be issued for business activities in the US.
Which conditions are tied to founding a US Corporation?
You need a US founding and corporate address, which is mandatory in the US and which we provide for you. This address is also the postal address of your company. We organize all your correspondence via this address and guarantee a prompt forwarding from the US to your home in Europe.
We cannot render the service of a detailed tax consultation at this point. We are not allowed to give any legal or tax advice. We can just say that much: the minimum tax rate of the US corporate tax for companies that are registered in the US and have their principal office there, is 15%. This tax rate is valid for income of up to $50.000 after tax. After this amount, the rate increases progressively: maximum tax rates are 34%, or, for income after tax of $10 million and more, the rate is 36%. Each corporation that has its principal office in the US, officially does business from the US and bills clients, can pay at these tax rates for its income in the US. There is no purchase tax, no licence tax, and no sales tax in Florida. Only if you sell products to the end-consumer in Florida do you have to charge sales tax to the client, which is paid to the state.
US company = actionability in Europe
With a US Corporation you are not limited at all to the US market in your business activities. Every properly registered US corporation can act worldwide and also establish subsidiaries. The only thing you need is the so-called apostille, issued by the Secretary of State in Florida if the seat of the company is in Florida. The certificate is based on the Convention of The Hague (Den Haag) from October 5, 1961.
You want the official version? Here you go:
“Foreign public certificates that are to be used in the Federal Republic of Germany and that for this purpose have an apostille, do not require any further verification or notarization. The apostille is a formality by means of which the authenticity of the certificate is confirmed after article 3 of the Treaty of The Hague from October 5, 1961, for the legislative waiver of foreign public certificates (Federal Law sheet 1965 II, page 875) issued by the authority that was hereto authorized by the state.”
Once your US Corporationst is officially registered in the Commercial Registry, it will be considered and treated as a German company in Germany, as long as it is properly registered. This is also valid for the other European Union member states.
What is a US Registered Agent?
The so-called Registered Agent is a contact person for administrative tasks imposed by the US state where your corporation is registered. Having a Registered Agent for your company is mandatory in the US. We provide a Registered Agent for you whom you can fully trust.
Establishing a Corporation Management
The management of a corporation consists of “Directors“ und „Officers“. Directors are the main stakeholders, make the most important decisions, and appoint the Officers. In a very small corporation, the two positions of Director and Officer can be held by one person.
What is an LLC (Limited Liability Company)?
The Limited Liability Company (LLC) comes closest to the German GmbH or a British Limited and is a variant in the US forms of enterprise. You are only liable with your company’s assets, whereas the associates are personally taxable. This form of enterprise provides many tax advantages for foreigners who want to found a US corporation. Don’t hesitate to ask: We gladly support you with founding an LLC as well!
Can you tell us about reference clients?
What is a Corporation?
A corporation is a US (stock) corporation (AG) with limited liability. As its founder, you determine the volume of equity capital, which you do not need to provide, however, in order to found a corporation. In the State of Florida, where we register your US corporation, you do not have to provide any evidence of equity capital in order to found a new corporation. Please click here for further information regarding the advantages of a US corporation.
Forming a LLC, Ltd. or US Corporation
Comparing the US Corporation with the company form of the British Limited or the German GmbH in tax terms, the advantages of the US Corporation are significant. Even though the British Limited was considered as a great tax saving opportunity for a long time, nowadays this chance is long over in European Union member states: a so-called “Europe Ltd.” is now subject to taxation in Europe – with the highest tax rate in the whole continent. A US corporation, on the other hand, pays taxes in the US, which – if the business activities are executed in a foreign country – mostly only amount to the minimum rate of $150 p/a. This way the corporation can document to European authorities that it actually exists and at the same time save taxes. For a US corporation that is active in the US, bills in the US and has US accounts, tax duty lies between 15 and max. 34%.
European authorities have become alert when it comes to Limited Corporations. They are often able to prove that their company is only headquartered or located in England in pretence, yet actually elsewhere, which often results in a trade ban. You do not face this risk with a US Corporation that is active in the US! Compared to a German Limited Liability Corporation, the US Corporation has the advantage that it can be organized in a much easier way: while European Ltd. conditions do not allow this feature, the US Corporation can have only one person take several or all positions in the company, i.e. the founder can be the owner, associate, president, and CEO in one person. And: the Corporation has a good reputation as a company form, a fact that you will profit from as well.