File for LLC in my state or not?

[Meena Price]

Hello everyone,

I really want to jump into wholesaling. I have my business plan and market budget mapped out and such, but I'm very passionate about getting started the right way. I don't see this as a fly by night or "get rich quick", I want this to build something that is stable, long-term and most importantly--legally sound. I'm going to form a LLC. My question is should I file for a LLC in my state (Pennsylvania) or not? I'm sure many of you know that certain states--namely Delaware, Nevada and Wyoming are very business friendly and have many financial advantages over others. Also, in the case of NV, they have a privacy agreement with the IRS, giving some anonymity to NV LLC owners. Additionally, I will not have a storefront, I will begin my wholesaling in Pennsylvania, with the eventual goal of branching out to other locales. If you have any pros, cons, tips or experience with this, your knowledge is greatly appreciated!

[Justin K.]

At one point I wanted to open a Nevada corporation to own some of my PA LLCs for the very same anonymity that you mentioned and that I read others claim to be using. I have talked to several lawyers in my area (north of pittsburgh) and every one of them said that creating a Nevada corporation that never has any intention of doing business in Nevada will make it appear to a judge that you are trying to hide something or are at the very least doing something a little shady. Every one of them said to start a PA LLC and operate with respect to the laws and be courteous to your tenants and all will be ok.

As I continue to grow I will pick up a personal liability insurance plan and just own nothing except be the controlling power in the LLCs that own everything.  May even start a PA corporation to own my personal home so that it gets protected if something happens on the investment side of things.  

Great question though.  I am sure it will spur a great debate.  Interested in what others have thought/heard/done!!