Step II : Choose your State
All Corporations and LLCs are formed on the state level at a state agency that handles new filings (usually a Secretary of State or State Corporation Commission). The state in which you form (AKA Formation State) is your choice.
Although most small biz owners choose the state they live in, you should also keep in mind, the location of your business operations (i.e. staff and office/retail location), and your state’s taxes. Many consider filng in a tax neutral business-friendly state, especially if they plan to register their operations in multiple states at some point in the future.
State Filing Fees & Maintenance Costs
Part of your consideration should be the state filing fees, along with the costs to maintain your entity in that state. Once again, select your state from the drop-down menu to read about both of these areas.