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Question about forming an LLC and taxes

Asked by: Allison Ramsay  — 16 January, 2013

I recently formed my online accessory/jewelry company as an LLC in Delaware with a registered agent. However, I reside in Brooklyn, NY (Kings County). Is this ok?
Are there benefits or pitfalls in doing it this way?
Also, do I charge my customers tax? How much?
Do I need any business licenses?

Answered by: admin  — 16 January, 2013


Customers pay sales tax when purchasing tangible goods from companies with “nexus” in their state. Some states, such as Delaware, do not have state sales tax, so even though your company is registered in Delaware and hence has nexus in that state, you wouldn’t need to worry about sales tax on orders in Delaware.

Keep in mind, however, that since you run your business from Brooklyn and I presume would ship your products from your home that would technically create nexus for your company in New York, and would require you to register for sales tax in New York. If you plan to declare your home as “home office”, you may eventually be required to register your company in New York as foreign entity.

Finally, for your line of business I don’t think any licensing is required.

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