Delaware Corporation Merger Into a Delaware LLC

Delaware is regarded throughout the United States as being generally the best and most business-friendly environment in which to incorporate, according to the 2010 US Chamber of Commerce’s State Liability Systems Ranking Study. But being in Delaware alone doesn’t provide you all of the benefits you need to reap from your incorporation. Perhaps you currently exist as a Delaware corporation, but find that you need a merger into a Delaware LLC. Five reasons you may want to do this are:

  1. Simplified accounting – Corporations, especially those taking the subchapter S election, must comply with what can be more complicated accounting requirements than those for LLCs, at the state and federal levels.
  2. No entity-level taxation – If structured properly, Delaware LLC’s are not taxed at the entity level, as all income passes through to the individual level, avoiding many of the double-taxation problems inherent in doing business as a Delaware corporation.
  3. Fewer compliance requirements – Legal requirements are generally less stringent for Delaware LLC’s than for Delaware corporations. Delaware LLC’s are not required to be structured with directorial boards and are not required to hold formal meets or keep track of corporate minutes. And in Delaware, certain documents are not even required to be made public at all, such as Operating Agreements and those documenting changes in membership or management.
  4. Limited liability – Delaware LLC’s still enjoy the limited liability afforded by Delaware corporations.
  5. Ability to raise capital – While LLC’s do not typically have stock that they can sell, they have the potential to sell “interests” for raising capital, a function Sole Proprietorships do not have.

Ohio Corporation Merger Into a Delaware LLC

Like those needing a Delaware corporation merger into a Delaware LLC, you may be looking for simplicity, flexibility, and tax savings for your business. But perhaps you are also interested in merging your corporation from somewhere like Ohio into a Delaware LLC. Here are some reasons why this merger might be for you:

Legal Protection:

  1. The US Chamber of Commerce has ranked Delaware as the best legal system in the nation for eight consecutive years (United States Chamber of Commerce Institute for Legal Reform, 2010 Harris Poll)
  2. An established body of laws protect the corporations of Delaware, helping business owners focus on their companies rather than on court proceedings
  3. The Delaware Court of Chancery is the oldest business court in the country and uses judges instead of juries

Tax Savings:

  1. No state income tax for Delaware LLC’s that operate out of state
  2. No business license required for Delaware LLC’s not operating in Delaware
  3. No state sales tax on intangible personal property

Unmatched Flexibility:

  1. One person can hold all positions and be the sole owner of the LLC
  2. You do not need a physical address within Delaware
  3. The cost to form a LLC in Delaware is one of the lowest in the nation or anywhere in the world

Genuine Anonymity:

  1. By allowing you to file anonymously, Delaware laws shield the identities and personal information of business owners
  2. The State of Delaware does not require the names and addresses of LLC members and managers to be made public
  3. Legal proceedings or law enforcement actions are the only two circumstances under which this information must be revealed