So you want to create a Delaware C-Corp? This is a great choice for many businesses but isn’t the right choice for every US enterprise. With that in mind, it’s a good idea to learn more about the process and what the benefits are. That way you can make an informed decision for your company and its shareholders with the most advantages for everyone involved. So what are the best reasons to create a C-Corp in Delaware? Keep reading to find out.
It’s Ideal for a Start-Up Business
A brand new business in Delaware can take advantage of several tax and legal benefits that aren’t available in other states. A company doesn’t have to be in Delaware, nor do its shareholders need to be in Delaware to incorporate there. In addition, start-up companies in Delaware are protected by the state’s General Corporation Law.
Access to Helpful Legal Assistance
Because Delaware is the leader in corporate law and uses a judge system, rather than a jury, there’s the distinct advantage of the speed at which business ventures can move through the system. In addition, Delaware has a dedicated court system for corporate law, which often gives investors peace of mind when they decide to invest in a business that’s incorporated in Delaware. The protections offered by this court system make it safer for businesses to operate with a Delaware license, which makes it appealing to start-ups, as well as established businesses.
There are Tax Perks
Delaware is often referred to as a tax haven, which is another benefit to incorporating your C-Corp in the state. One of the best perks for a C-Corp is the opportunity to offset current losses with future gains. This is especially beneficial to start-up businesses since they tend to have higher financial losses in the first few years of operation. It allows for planning for future profit without getting too far into debt in the early years of operation.
It’s Good for Investors
A C-Corp in Delaware can more easily trade shares in stock and is also able to consistently sell shares of its stock to new investors. This allows for a healthy return on the investment but also speeds up the process of seeing enough growth to trade shares publicly. Additionally, a C-Corp in Delaware can sell stock to its employees, which offers an incentive when looking for new hires for the company.
The company can also use equity, rather than cash to sell stock to other businesses.
Finally, with a C-Corp, you’ll have the opportunity to issue a variety of stocks. This might be preferred or common stock or it could be convertible stock. The choice means more freedom when making business deals, which is good for the company and its investors.
Now that you know the best reasons to create a Delaware C-Corp, it’s time to call the Corporation Center to get started. Let us help you reap all the rewards as you work through the process of incorporating your business in Delaware. Call us today.
