The “tax haven” myth for small businesses
Most small businesses owe tax where they actually operate and earn income, regardless of formation state.
Nexus & doing business where you operate
Physical presence, employees, or significant sales typically create filing obligations in those states.
Fees, registered agents, & double filings
Out‑of‑state formations often mean you’ll register as a foreign entity in your home state and pay fees in both places.
When out‑of‑state can make sense
- Multi‑state operations with investors who prefer specific corporate law.
- Planned venture funding or complex equity structures.
- Specialized statutes or courts (e.g., chancery‑style) when growth justifies complexity.