Why do companies incorporate in Delaware, USA?

Updated time: 08 Jan, 2019, 11:57 (UTC+08:00)

There are many reasons why more companies are incorporated in Delaware than any other state. This article highlights a few of the reasons why half a million businesses, including more than half of all U.S. publicly-traded companies and 60% of Fortune 500 companies, have incorporated in Delaware.

The legal and liability protection of established corporate laws provided to Delaware companies is simply incomparable to what is offered by any other state in the nation, which makes it the Incorporation Capital of the World.

Delaware companies also enjoy incomparable tax savings. There is no state income tax for Delaware corporations that conduct business out of state; no inheritance tax on stock held by non-Delaware residents; no state sales tax on intangible personal property (such as royalty payments); and share of stock owned by non-resident aliens are not subject to Delaware taxes.

Delaware corporations not operating in the state of Delaware do not need to acquire a business license in Delaware

The privacy afforded to owners of Delaware corporations and LLCs is also incomparable. The state of Delaware allows you to file your company without listing the names of the owners, which protects the owners' identities, personal information and privacy in general.

The cost to form a corporation or LLC in Delaware is one of the lowest over the world.

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