U.S. Corporate Registration

Nowadays, many large companies choose their overseas company domiciles according to the characteristics of their products. For example: high-tech industries, instruments, equipment, health food, cosmetics, garments and other well-known manufacturers are mostly U.S. companies.

When the company is successfully registered in the name of the U.S. company to license production in China / Hong Kong / Southeast Asia, not only to improve the image of the product, while increasing sales value added to develop the international market. The advantages of incorporating a company in the United States are as follows:

1、Reasonable tax avoidance, reduce financial and tax burden: All foreign companies in our country have the policy of reducing or exempting from taxation, using international transfer prices to allocate profits and expenses, such as not operating business in the U.S. mainland, can be exempted from corporate income tax, corporate share tax and personal income tax, only the normal annual fee can be delivered, so you will save a considerable tax burden every year.

2、Facilitate international trade and avoid tariff barriers: Registering a U.S. company allows you to bypass tariff barriers and obtain tax-free treatment, allowing you to successfully bypass export quota restrictions. This allows you to successfully bypass export quota restrictions and greatly increase the amount of your trade.

3、Immigration and visa convenience: Immigration to the United States is the dream of many people, but the high threshold makes the majority of business people discouraged, when you register a U.S. company, you as a shareholder of overseas companies (equity, property, assets) you will get legal proof. You can always provide yourself with the opportunity to go to the United States for business activities, you can send invitations in the name of your U.S. company, which greatly facilitates the visa to the United States, children to study, friends and relatives guarantee, group business visits, and remove obstacles for your family immigration.

4、Avoid foreign exchange control and facilitate overseas listing: Registered U.S. companies can enhance their overseas financing capabilities by applying for relevant commercial or project loans directly in the country and listing directly or indirectly overseas.

5、Convenient incorporation procedures and low cost: The incorporation procedures for U.S. companies are very simple and are generally completed by professional registration agents, without the need for the registrant to go to the place of incorporation in person. The incorporation fee is low, and there is no capital inspection requirement, and the registered capital does not need to be paid.

6、Reverse investment: A U.S. company can also be established to invest in mainland China as a foreign-owned enterprise or joint venture, and enjoy the treatment of foreign investors, such as tax exemptions and other policies.

7、Freedom of choice of name, no restrictions on the scope of business and geographical area: There is no restriction on the name of the registered U.S. company, you can choose any company name you like, and you can prefix it with U.S. XX Corporation; after the company name, you can prefix it with “Association, Foundation, Organization, Society/Institute, Federation/Alliance, Corporate Association/Consortium, etc.

8、Only trust management companies legally authorized by the company can access the company’s registered information.

9、Easy corporate governance: Overseas companies are not required to hold annual general meetings and board meetings.

LLCs are flexible and can be used for a wide range of businesses, making them the preferred choice for small and medium-sized entrepreneurs.

Advantages: Shareholders have limited liability to the company, and as a shareholder of the company, personal property is not tied to the company’s debts, and the company enjoys the same rights as individuals. Compared to other types of corporations, LLCs do not require excessive paperwork; they prevent double taxation of the corporation; and they are very flexible in management, requiring at least one person to operate and manage them.

Disadvantages: Some states, including California, charge additional fees for operating an LLC. A business operating as an LLC may be subject to payroll taxes or self-employment taxes on all income. Some states do not allow professional groups (i.e., doctors or dentists) to operate through an LLC.

Type of registered company 2: Joint stock limited liability company Inc.

A Corporation is the most common type of corporation in the United States. It legally separates the assets and income of the owners or shareholders from the corporation and limits the personal liability of directors, shareholders, officers and employees. The corporation is formed and continues to operate even if the shareholders, directors, officers, and employees of the corporation’s founding members leave the corporation. A limited liability company can offer unlimited growth potential through the sale of stock, which means that it can attract some very wealthy investors, so there is no limit to the number of shareholders in a limited liability company.

Advantages: Provides business owners with more tax-related options, maximizes the separation of company and owner, and allows companies to raise capital through the issuance of publicly traded stock. A limited liability company is the only type of organization that can “go public” and sell an unlimited number of ownership shares. They are generally subject to higher tax rates due to taxation at both the individual and corporate levels, however, this is often offset by access to more capital, higher earning potential and ultimately profits.

Disadvantages: In terms of taxation, a limited liability company is subject to corporate income tax at the company level as well as personal income tax at the individual (employee and shareholder) level, resulting in a double taxation situation. The company operates at a high price at the beginning and the filing of articles of incorporation requires a lot of fees. Complex tax rules and protection of owners from liabilities, lawsuits and other financial obligations. Relatively speaking, a limited liability company experiences more governmental oversight than other companies.

Registered Company Type 3: S Corporation

The structure of a Small Corporation (S Corporation) is similar to that of a Limited Liability Company (LLC), but there are some significant differences. The most important of these differences is that SSCs have a special pass-through tax status with the IRS. This allows the owner to avoid double taxation of its business income.

Advantages: Smaller companies have tax advantages, no or lower corporate tax and self-employment tax on owners, no double taxation, and protection of corporate and personal property. Smaller companies are recognized in the community and have a certain level of prestige and credibility. For small businesses, a small joint stock company is the best option, combining the benefits of a corporation with the tax advantages of a partnership.

Disadvantages: Although small joint stock limited liability companies are largely exempt from corporate taxes, they must still report their earnings and file tax returns with the federal government. Registration costs are higher, requiring an annual registration fee, and there are complex compliance rules behind the policy. Smaller LLCs have the potential to inhibit growth because they cannot go public and peddle their stock, must have fewer than 100 shareholders and have a status requirement of being a U.S. citizen or green card holder.

Registered Company Type 4: Sole Proprietorship

Sole Proprietorship is for small entrepreneurs of one person or more and is the most common structure chosen to start a business: an unincorporated business owned and operated by one person, with the owner entitled to all profits and responsible for all debts, losses and liabilities of the business. Sole proprietors, like all businesses, are required to obtain the necessary permits and licenses, and registration regulations vary by industry, state and locality.

Advantages: Sole proprietorship is the simplest and cheapest business structure with minimal registration fees and legal fees limited to obtaining the necessary permits or licenses. Since you are the sole owner of the business, you have full control over all decisions. Sole proprietorships are not only taxed exclusively, so it is easy to fill out the tax reporting requirements for sole proprietorships, and the tax rate for sole proprietorships is the lowest of any business structure.

Disadvantage: Because there is no legal separation between you and your business, you may be personally liable for the debts and obligations of the business. This risk extends to any liabilities and legal obligations arising from the actions of your employees. Sole proprietors often face challenges when trying to raise capital; sole proprietors cannot sell stock in their businesses and banks are hesitant to lend to sole proprietors. If the business fails, there is considered to be additional risk in repayment.

Conditions of Incorporation of U.S. Companies

1、Application requirements: one or more directors and shareholders (natural or legal persons without international restrictions), valid identification documents (ID card or passport).
 2、Name selection: There is no restriction on the company name, as long as there is no duplicate name; generally the name is followed by the words CORP (CORPORATION), LTD (LIMITED), INC (INCORPORATED) or CO (COMPANY), LLC, etc.. Please include two or more company names when registering to avoid delays if you do not choose one. Before the establishment of the company, the company name can be reserved free of charge for six months.
 3、Registered capital: Different continents, the registered capital is different, generally 50,000 U.S. dollars (please refer to the registered address of each continent for details), no capital verification and in place. When registering a company, it is necessary to specify the amount of shares to be issued upon the establishment of the company. Usually the initial amount of shares issued is 3,000-50,000 shares. The number of shares issued can be increased at any time after the company is established.
 3. Share allocation: The percentage of shares (%) for each shareholder of the U.S. company applying for registration.
 4、Registered address: A local registered address is required (a U.S. registered address can be provided for joining our secretarial service).

Check if your company name is registered and make sure it is unique to you.

02 Select the state and address of the company

Each of the 50 U.S. states has its own business regulations and tax programs, and the address where you register your business can affect your registration requirements and taxes.

03 Selecting the type of company and registered agent

The type of corporate structure will affect the company’s registration requirements, corporate property rights, tax payments, and debt obligations. The common types of corporations are LLC and INC, and only S corporations require that the owners be U.S. citizens or U.S. green card holders. The registered agent can be either the registered person or a representative of another person in the local state, whose primary obligation is to receive corporate documents and tax correspondence.

04 Writing of Articles of Incorporation

It varies from state to state.

05 Registered Company

Some states require newspaper publication, which varies from state to state. If you wish to register a trademark for a business, brand or product name, you may submit an application to the U.S. Patent and Trademark Office after the business is incorporated.

06 Application for Corporate Tax Identification Number (EIN)

A corporate tax ID number, also known as an Employer Identification Number (EIN), is used to conduct corporate business, such as opening bank accounts, paying taxes, hiring employees, etc. It is similar to a corporate “Social Security Number”.

07 Applying for Licenses and Permits

Maintain legal compliance to keep your business running smoothly. The licenses and permits required for your business will vary by industry, state, location and other factors.

There are 50 states in the U.S. where you can register your company. The business environment and policies vary from state to state, and the time frame for registration also varies.