US LLC holding company for European subsidiaries
I am thinking of setting up a single person (could be 2+ if that would be beneficial though) Nevada LLC, which I would like to serve as a holding company for two European companies selling services and products respectively, in Europe. The question I have for you is how to set this up in the most efficient way possible in the US? Would the US LLC become a "personal holding company" - which I have heard negative remarks about due to some extra taxing? I am non-US resident, and not yet sure how the cash flow of my business should go for most efficiency; stay in Europe or flow to the US LLC via dividends? Would any other state make a positive difference for my purpose e.g. New Mexico, Delaware, or Wyoming? No direct sales and no direct income will be made in the US, at this point. However, I do want the mother-company to be US based, due to potential future US business. Many thanks in advance for your support!
Let's start with some definitions: Personal Holding Company you are referring to can only be an entity taxed as C-Corporation, not LLC that is elected to be taxed as partnership (or disregarded entity, if it only has one member).
The question really is - why bother setting up a US company to hold European companies doing business in Europe? If at any point you would choose to expand to the US market you would be able to just form a US company that would conduct business in the US only. That entity could be owned by you (and your partners), and you could establish contractual relationships between this company and your European companies.
If you insist on forming a US-based holding company I would suggest not to choose Nevada, for no other reason but the fact its more expensive to form and to maintain Nevada companies nowadays, as compared to Delaware or Wyoming, the other two incorporation heavens. As far as New Mexico LLC goes, what you get there is a very discreet entity (member information is never filed with the state) with no annual fees to be paid to the state, meaning you can't get it into bad standing, or, worse, administratively dissolved, because you forgot to pay some annual fee.