If you are making plans to set up a business in the United States, without necessarily living there, one of the important decisions you need to make is; which State in the US is best to register your company as a foreigner? The United States is made up of about 50 states, and that is a lot to choose from.
However, as a foreigner, particularly an African who doesn’t live or work in the United States, you need to approach this question differently because the policies and regulations in most States with respect to issues such as taxes, immigration, setting up a business account, etc. is different from that of US citizens. The last thing you need is to be slammed with taxes, levies, and permits that you didn’t anticipate or make adequate plans to pay for.
By the time you are done with this article, you should be able to determine the best State in the US that will be most suitable for setting up your business.
WHICH STATE IN THE US IS BEST TO REGISTER A COMPANY AS A FOREIGNER
As a foreigner, particularly an African, who does not live or work in the United States, there are two States in the US we primarily recommend foreign business owners or founders to consider setting up their businesses. They are; Delaware and Wyoming. This doesn’t mean that other States are bad generally speaking, however, when you weigh each State side by side with certain benefits which are important to founders and business owners who are foreigners and non-residents, the State of Delaware and Wyoming stands out.
In this diagram below, we’ll list out the benefits we believe are most important for your consideration when setting up a business in the US alongside each state. We hope that with this, you will have a fair idea about which State to opt for your prospective US business.
| BENEFITS | DELAWARE | WYOMING |
| For startups looking to raise funds from investors. |  (Equity investor’s preferred choice of incorporation for investing in Startups) |  |
| 2. For small businesses who simply wish to access the American market | | |
| 3. Officers of the company are not mandated to live in the State of choice | | |
| 4. Most suitable for Limited Liability Companies (LLCs) as it is flexible to operate and the cost of operations is low. In addition, as an LLC, the business is exempted from paying corporate income taxes or annual franchise tax | | |
| 5. Highly recommended for C-Corps as shareholders (in this case investors and founders) are well protected legally.
| | |
| 6. Less annual filling fees after registration | | |
| 7. No minimum share capital requirement | | |
| 8. One person can set up an LLC or C-Corp in the State | | |
| 9. There are no taxes on company shares (either LLC or C-Corp) | | |
| 10. Details of Shareholders are confidential | | |
(Which State in the US is best to register my company as a foreigner, designed by Lex-Praxis www.lexpraxisng.com)
CONCLUSION
Please note, the benefits provided in the table above, have been outlined bearing in mind only startup founders or business owners who are; non-US citizens, who do not live in the United States, and who do not work there either. If you do not fall under these criteria, I recommend you seek legal advice to determine which is best for you.
As much as we’ve created a guideline in the table above to enable you to arrive at a decision regarding your preferred State of choice for your proposed US company, we also recognize the fact that there is no size fits all indicator for determining what State is best for your business as a foreigner/non-resident as the circumstances informing such decision may vary from one individual to another.
We recommend you seek the services of qualified and experienced business lawyers and experts who will enable you to arrive at an informed decision as well as assist you with designing your business expansion strategy into the United States.
Need help with launching your business in the US? Feel free to reach out to us by clicking the Whatsapp icon on your right or clicking HERE, and we’ll be delighted to guide you on your business journey.
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