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Richard
Richard, Attorney
Category: Business Law
Satisfied Customers: 54322
Experience:  32 years of experience practicing law and a businessman.
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Business Law

If someone has incorporated in Delaware but lives in California,

and conducts business online (no... Show More
and conducts business online (no physical business in CA), the question is where can/should that Corporation open a Bank Account?

Does opening a bank account in California incur CA Franchise Tax and other fees of doing business in CA?

Can a bank account be created in Delaware if the person who incorporated lives in California? Can a bank account be opened via the Registered Agent in Delaware or some other remote means.

Can the bank account be opened somewhere else, such as Nevada?
Submitted: 7 years ago.
Category: Business Law
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replied 7 years ago.

Good afternoon. You would want to open your bank account in Delaware and not create ties with California which would give rise to doing business in California. You can open a bank account by mail...simply have the bank forward the forms to open the account, fill them out and sign them, and then return them. I would recommend that you sign up for online banking and statements so that you don't have a bunch of mailings to California, but simply living in California and having statements sent there would not constitute doing business in California.

 

 

I hope this has given you the guidance you were seeking. I wish you the best of luck!

 

 

 

The information given here is not legal advice. As all states have different intricacies in their laws, the information given is general only. This communication does not establish an attorney-client relationship with you. I hope this answer has been helpful to you.

Customer reply replied 7 years ago.
Thanks for the quick reply. Does having a Bank Account in Delaware incur income tax for delaware? It seems like delaware is the best option for incorporation. Is it also the best option for the bank account?

Seems like you are saying CA bank account is definitely not the way to go.

How about a bank account in Nevada or something like that?

Also, what would a corporation need to open a bank account in Delaware? Tax ID #, I know. Does the business need a physical address other than the registered agent to open a bank account in Delaware?

I've seen conflicting information about whether having a physical location in Delaware separate from the registered agent is necessary.

Thanks again - I'm happy to Accept just want to make sure I get all my questions answered :).
Richard, Attorney replied 7 years ago.

Actually Nevada is a great spot to do business because it has no franchise tax at all. But, because you are doing business on-linie, you could incur income tax in each state that you are deemed to sell things in. ... this is a complex tax question that you should get direction from your CPA about. What you need to open a bank account is a Taxpayer ID...which you can get on line from the IRS, your organization documents evidencing the existence of the entity, and a shareholder resolution/certificate authorizing you to sign. Plus, it will need an address, but you can use the registered agent address.

 

 

I hope this has given you the guidance you were seeking. I wish you the best of luck!

 

 

 

The information given here is not legal advice. As all states have different intricacies in their laws, the information given is general only. This communication does not establish an attorney-client relationship with you. I hope this answer has been helpful to you.

Customer reply replied 7 years ago.
Ah, thanks for the clarification.

Seems like if the business is all online and sells digital downloads (i.e. pictures/videos/etc) then the "state" where things are sold is really nebulous.

But, that's a separate issue :).

Appreciate all your help!

Richard, Attorney replied 7 years ago.
My pleasure. Good luck with your business! You are correct on the income tax question....I recommend that you take an aggressive approach on this...you don't need to necessarily play it safe if you have a good colorable argument not to pay taxes everywhere. :)

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