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Delaware means suspicious. Myth or reality?

Asked by: Vitaly  — 31 January, 2013

They say that a foreign corporation formed in Delaware, Wyoming or Nevada looks suspicious for IRS and the like. They are treated as if they are designed for money laundering and other fraud activity. Is it a myth or reality? What is the reason for these gossips? Isn’t it better to incorporate in a different state to be treated seriously?

Answered by: admin  — 31 January, 2013


The IRS treats everyone seriously, regardless of what state they are registered in. I haven’t heard of any horror stories involving companies registered in those specific states, although rumor says Nevada has some friction with the IRS because they don’t like to cooperate with them or something of that kind, but, you know, rumors say lots of stuff.

Besides, at least Delaware is known as the capital of incorporations, and most big companies that are traded publicly (and those small that aspire to) choose that state as the state of incorporation.

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