Many of our clients are business owners, and indeed, Reno is a fantastic place to establish a business, whether it is a small operation or a large corporate location. There are a number of different reasons why the state of Nevada is very attractive to members of the business community.
One of them is the fact that there are not a lot of heavy taxes on businesses in our state. If you were to establish a limited liability company in Nevada, you would not have to worry about paying any franchise taxes or state level personal income taxes. Plus, you do not have to be a resident of the state to own or possess shares in a business in the Silver State and take advantage of these tax benefits.
The state also provides some very robust incentives in an effort to lure businesses. There are sales tax abatements on capital equipment purchases, and there are personal and modified business tax abatements. If you recycle, you get a real property tax abatement, and there is assistance available for intellectual property development and grants are available for training employees.
Another major benefit is the relatively low cost of living compared to places like San Francisco, New York, and Seattle. People that need jobs can afford to live in Reno and other cities in Nevada, so employers can find qualified workers to fill positions at all levels. Plus, if you are trying to recruit top talent, the fact that money goes a lot further in Nevada will definitely be a very useful bargaining chip.
Choosing the Right Business Structure
Without question, Reno has an excellent environment for starting a business. If you decide to start a small business, you have to choose the correct business structure. The attorneys here at our firm have a great deal of expertise assisting clients that are establishing businesses. Asset protection is usually a very big concern. It is important to separate your personal assets from the assets and the actions of your business entity.
We mentioned limited liability companies previously, and as we have stated, there are definitely tax benefits in our state if you establish an LLC. The structure is also very good for protecting assets. If your limited liability company was to be sued, or if creditors were to seek a judgment against the LLC, it is very likely that your personal property would be protected. On the other side of the coin, if you were personally targeted, assets held by the limited liability company would be protected in most cases.
Another asset protection structure that can be quite useful for many people is the family limited partnership. As the name would imply, people that are involved have to be members of the same family. If you were to set up a family limited partnership, you would be the general partner, and family members that you add to the partnership would be limited partners. As the general partner, you would have sole decision-making authority.
To explain the value of a family limited partnership for asset protection, we will provide an example. Let’s say that you own three apartment complexes and a shopping center. You could convey each property into a separate family limited partnership. If there is any legal action taken against property that is held in any of these partnerships, that single family limited partnership would be targeted; the rest of your holdings would be out of play.
You could place your bank and brokerage accounts into another family limited partnership and leverage the financing so that you really do not have a lot of equity in any of the investment properties that could be attached.
The asset protection works in the other direction as well. If you or any other member of a family limited partnership was be personally sued, assets that are held by the partnership would be protected. These are a couple of business structures that are commonly utilized, but there are others. The ideal choice will depend upon the circumstances.
Attend a Free Seminar!
If you would like to learn more about any estate planning, financial planning, or elder law matter, attend one of our free seminars. There are number of dates on the schedule, and you can click this link to obtain more information.