For the past 9 years, the U.S. Chamber of Commerce has ranked the 50 states’ liability systems and corporate law structure as a whole. Delaware is unique in that it ranks #1 for the ninth year in a row in a survey generated by the United States Chamber Institute for Legal Reform. The survey polls judges, attorneys, professors and others for opinions on which state offers the best structure. Many states that are supposedly corporate friendly, such as Nevada, are buried deep in the list and continue to decline year after year while Delaware flourishes and repeatedly ranks highest on the list. After reading this report, it is not surprising that a good portion of our business comes from the state of California, considering its law structure is one of the absolute worst. Residents of Delaware are grateful for the strong corporate law structure their state has created because it benefits every resident. Over one-third of Delaware’s income can be attributed to the Division of Corporations. For example, in 2009, the corporate Franchise Tax alone generated $1,648 for the average Delaware household.
This strong corporate law structure protects individuals behind their companies, which is why money is generated from people around the world who incorporate in Delaware. This revenue even enables Delaware to be one of the few states without a sales tax. The state of Delaware will continue to keep laws on the cutting edge through consistent judgments and by maintaining a reasonable and fair legal environment for corporate entities. To review the report, go to http://www.instituteforlegalreform.com/states/delaware
THE AUTHOR OF THIS BLOG ARTICLE IS NOT A LAWYER AND HARVARD BUSINESS SERVICES, INC. IS NOT A LAW FIRM. THE ARTICLE ABOVE IS NOT INTENDED AS LEGAL ADVICE AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. THIS SHORT ARTICLE IS STRICTLY TO MENTION SOME ASPECTS OF DELAWARE’S CORPORATION LAWS AND/OR LAWS RELATING TO OTHER FORMS OF ENTITIES WHICH YOU MAY NOT BE FAMILIAR WITH. WE RECOMMEND THAT YOU CONSULT WITH A LAWYER BEFORE FORMULATING A STRATEGY WHICH WILL BE SUITABLE FOR YOUR SPECIFIC CASE.