It's the money, especially of the tax variety. See especially #4-#6.
16 Reasons Why Delaware Is The Choice of Corporate America
1. There is no minimum capital requirement. A Delaware corporation can be
organized with very little capital if desired. Many states require that a
corporation have at least $1,000 in capital.
2. One person can hold the offices of President, Treasurer and Secretary and be
the sole director. Many states require at least 3 officers and/or directors.
Thus, there is no need to bring other persons into a Delaware corporation if
the owner does not desire it.
3. Delaware is the only state to have a continuous Court of Chancery - a
separate business court system. This is meaningful to entrepreneurs for several
reasons. First, there is a long-established body of laws relevant to
corporations that has been tested in the Delaware courts over many years. In
the event of any legal action, therefore, there is a high degree of
predictability. Second, the court has no juries and judges are appointed for
their expertise, not because they won an election. Third, Delaware has a long
record of pro-management decisions.
4. There is no corporate income tax for corporations that are formed in
Delaware, but which do not transact business in the state.
5. The annual Franchise Tax on corporations compares favorably with other
states (as little as $50/year in most cases).
6. Shares of stock owned by a person outside the state are not subject to any
7. A person can operate as the owner of a Delaware corporation anonymously.
8. One can form a corporation by mail or phone and never visit the state, even
to conduct annual meetings. Meetings can be held anywhere, at the option of the
9. Delaware is the friendliest state to corporations. Its Corporation
Department revenue is exceeded only by income taxes. The State, therefore,
depends on attracting a high volume of corporations and has a great incentive
to keep its laws and fees favorable.
10. There is no estate tax on shares of stock held by non-residents. These
shares are taxed only in the state of residence of the owners of the
11. Stockholders, directors, or committee members may act by unanimous consent
in lieu of formal meetings.
12. Corporations can pay dividends out of profits as well as surplus.
13. The same corporation may conduct different kinds of businesses. If the
corporate documents filed with Delaware have the broadest type "purpose
clause", any legal business activity of any kind may be conducted. More than
one type of business can be conducted by the same corporation without any
changes in the documents filed with the state.
14. The director(s) has the power to make or alter by-laws.
15. Delaware corporations can provide special protection for directors and
limit their liability.
16. Recent legislation in Delaware limits abusive takeover tactics.
Hitler Hitler Bo Bitler. There, that ought to prove my point.