Hey folks! Is there anyone here that being an Euro...
# general
p
Hey folks! Is there anyone here that being an European (EU) incorporated an LCC in the US, namely in Delaware? I was almost decided to commit to Stripe Atlas, but started reading and seen reports like this: https://www.reddit.com/r/ycombinator/comments/17qmdx5/comment/k8e88ee/ What have been your experience and what recommendations can you give? Apparently being an US citizen alleviates a lot of these troubles. I'm an EU citizen with 0 knowledge about US tax and stuff, so I would value having a service that handles that for me 💸
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c
I am most definitely NOT a lawyer, so you should fact-check everything I say, but hopefully it can help you as a starting point. I'm going to start with the assumption that you meant "LLC" not "LCC" (I don't know what LCC is). An LLC is a limited-liability corporation.
An LLC has "members" which are similar to "shareholders" in a C-Corporation. A member is someone who owns a share of the company. One important thing about an LLC is that it is a "pass-through" entity, which means that if an LLC makes $100 in profits in one year, and you are a member owning 50%, then 50% of those profits (i.e. $50) show up as personal income on your own tax returns even if you don't pay yourself those profits. If you distribute those profits to the members of the LLC later, then the distributions are tax-free (since you already paid the taxes prior). That is different from a C-Corp, in which the corporation pays corporate tax (after the 2017 tax cuts, it's 21%) on profits. Then, the corporation can pay its employees or distribute to its shareholders, and those distributions are generally taxed as income. So in this way, an LLC gives you some tax advantage over a C-Corp.
LittleHorse's structure is slightly complex, but the most important part of it (LittleHorse Enterprises LLC) was created using ZenBusiness. It is quite cheap, and they have registered agent services. I actually incorporated it in Nevada, since the LLC laws in Nevada are slightly simpler than Delaware
Delaware is the "de-facto" state for creating a C-Corp in, but I know that Elon Musk is not a fan of it 😂 due to some perceived excessive restrictions on what the owners of the corporation can do
So the TLDR: 1. Don't know about requirements for US Citizenship 2. For just a simple LLC, ZenBusiness can work 3. Taxes are very different for LLC and C-Corporation 4. Maybe might be worth looking into an S-Corporation if you can't get an LLC without being a US Citizen 5. Almost all (actually, maybe all) venture-backed startups are C-Corps because that's the only structure that really makes sense for outside investors 6. Check out Zen Business to create an LLC quickly and get a registered agent: https://zenbusiness.com
and most importantly: I'm not a lawyer so check all of this
I spent two days researching this and ended up deciding to make LittleHorse an LLC since we're not pursuing venture funding.
p
Thank you Colt and sorry for this late reply. I do not intent to raise capital... maybe a sell in a future if it does not fail 😛