Day by Day New Lessons

August 14, 2008

Today I learned about Corporate Tax Laws and accounting practices that need to be in place if you plan to make money with your Work-from-Home Internet business.

Delaware is no longer the corporate tax haven. About 8 years ago they changed tax laws that eliminate their tax haven status. The new tax haven states are Wyoming and Nevada. Below is a comparison of the tax laws in Texas, where I live, Wyoming and Nevada.

TEXAS - Texas is know as having Traditional tax laws. Their Privacy Policy for corporations is Public. When you register for a corporation it is published in the Court House. Tow different tax laws are applied to corporations in Texas. The Franchise Tax and the Excise Tax. The Franchise tax is a flat 5.5% of all money your corporation generates. The Excise Tax is a dollar amount based on the amount of money your corporation makes. Both of these taxes are paid annually to the state of Texas. Filling Fee paid annually to the Secretary of State, the Department of Revenue, State Business licensing Division, The City or County Business Licensing Division, and for your State Tax ID. A rough estimate of these combined fees is about $1025 per year. Could get expensive it seems.

Wyoming - Wyoming is also know as a Traditional Tax law state. Their Privacy Policies are Non-Disclosure. They have no flate percentage rate or Excise Tax and their Franchise Tax is $50 per year They have what is called Front Loading Filing Fees. This is a one time fee of $1480 for each corporation you own.

Nevada - Nevada is Not a Traditional Tax Law state This means you can create subsidiaries beneath your main corporation, protecting each corporation from a law suit levied against one of the other. Privacy Policy is Non-Disclosure. No Franchise tax; no Excise Tax. The Filling Fees are Front Loaded and a one time fee of $2865.

Because website marketers will probably have more than one website the benefits of the add on subsidiaries has unlimited potential. Of course we never expect to be sued, but who know what expense or damage an unsatisfied customer may cause.

This is well worth further investigation and research. Stay tuned for more information as I learn more.