Nevada LLC v Connecticut LLC

[Rich Sutherland]

Hello All,

An absolute newbie here!

I have a partner who has created an LLC in Nevada for flipping houses as they were advised it was best. Ive done a little research and looks like it is more beneficial to create an LLC in the state we are flipping in.

We would be investing and flipping in CT & NY.

How does the creation of the LLC in NV 'trump' one in CT or NY? Is it more beneficial to have it registered in NV and pay the out of state fee's etc?

Any help or assistance is greatly appreciated.

Thanks in advance for your experience and knowledge on this complicated issue!

Cheers

[Daniel Raposo]

I've seen a lot of Guru's and other programs pushing the whole out of state incorporation for tax and liability protection, but I have never really understood the benefits of it to be honest. 

No matter where you incorporate you still have to be registered in CT if you're doing business here. If you're flipping a house and someone gets hurt on your property and sues you, they're going to be suing you in CT, so CT laws would apply not whatever state you're incorporated in so friendlier laws there wouldn't make a difference. If you meet the requirements of piercing the corporate veil in CT then guess what they're going to come after you personally even if you're incorporated in another state. Am I wrong about this?

If you're doing business in CT you still have to file a CT tax return for business activities in CT, so even if the state you're incorporated in has better tax rates, you're still paying the way worse CT tax rates for all the business you're doing here. Am I wrong about this?

If I'm not wrong about the two above situations why would you want to incorporate somewhere else and pay for all the additional setup fees and filing fees.

If I am wrong about the above situations I would love to hear from an attorney or CPA about why I am wrong and how it would really work, because this is something I've heard mixed reports about for years...