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Should I start a new web business in California, or Delaware?

  • I would like to start a new business, which will be online. doing web design. I reside in California but have been looking into creating a Delaware LLC. If all of my work is online, and the payments for the work is made to the LLC and not me, do I still need to file as a foreign company to do business in california? Would there be any difference if I talked to someone personally to say build a website for them as an independant contractor, which would be contracted to the LLC. I do not have an office and could essentially work from anywhere. Or is it too much hassle to deal with a delaware and just file in california. It was also proposed to just do business as a sole proprietor. What do you guys think?

  • Answer:

    You may refer to this:

Raksha Chandra at Quora Visit the source

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Given the type of business you are considering, there is no reason to form your limited liability company (LLC) in Delaware. If you form it there, then the LLC also will need to register in California, meaning that you will need to pay two states, up-front and annually thereafter, for the privilege of the LLC's existence.As concerns LLC vs. sole proprietor, there are considerations that only you can fully evaluate, such as: What will your tax advisor say, taking into consideration your current tax situation and the business's expected financial performance? To what extent will you need the LLC to act as a "legal firewall" between you and the business's liabilities? To what extent can that need be mitigated by various forms of insurance, and will you be able to qualify for those forms of insurance? This answer is not a substitute for professional legal advice....

Dana H. Shultz

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