Does what state you form a LLC matter?

[Kelly Melrose]

Hi all,

I'm just starting out and am about to form a LLC. My home state doesn't seem to have the most favorable LLC laws. I'm thinking about forming a LLC in another state but have a couple questions concerning the matter?
Do the state laws where you do business take precedence over the state laws where you formed your LLC? Are there any tax implications for forming a LLC in another state? If it can be more favorable to form an LLC in another state, does anyone suggest a good state that has excellent LLC protection?

Thanks in advance for the thoughts.