Or should I contact an attorney?
Any details you can provide of your experience would be greatly appreciated.
An "international company" means (to me) a corporation organized under the laws of a country other than the United States. If you "register" (this is an imprecise word and could mean many things) your corporation in Delaware you have potentially exposed it to US corporate income taxation. This means that it pays tax on its profit. Then it potentially pays tax of 30% of its after tax profit. (This is the branch profits tax). I give this as one example of the tax cow pie into which the unsuspecting foot can fall.
Figurre out why you are interested in entering the US. Then figure the tax exposure. Then you will understand the "what should I do?" and "who should do this for me?" questions.
There are many ways you can enter the US market with a non-US company. Almost invariably your default best choice starting point will be to form a US company rather than have your non-US company enter the US directly. Figure that as your strategy then try to prove it wrong.
Delaware is overrated unless you are General Motors.
And yes IAAITL (I am an international tax lawyer).
@philiphodgen
I have incorporated in Jamaica, and as far as I understand it, there is a double taxation treaty between the US and Jamaica that allows me only paying taxes once (i.e. more than likely in Jamaica) and not having a liability in the US.
I could be mistaken, and if there is another reason for me to take a step back, please let me know.
All I want to be able to do is easily accept all major credit cards, from customers in the US & Europe (all in US dollars), and have the funds deposited into a bank account that gives me the ability to wire to and from electronically.
Based on my research so far, there are a number of banks that have this setup, but the first step is to be incorporated.
Thoughts?
Your idea will cause your Delaware corporation to be doing business. Depending on how you configure your business operations your Delaware corporation might be acting as your agent (taking a commission) or it might buy from your Jamaican corporation and resell at a profit. Figure out what is best. in situations like this you can often operate your US corporation so it makes modest profits in the US thus pays modest tax in the US. Google "transfer pricing" for he way this game is played at high revenue levels. At low revenue levels it will work fine.
You mention tax treaties. Be sure you qualify for treaty benefits - look at the Limitations on Benefits clause. Be sure that the US won't tax business profits derived in the US.
What you think you can do with a US bank and what you will actually achieve - light years apart. You have to be sitting there in front of the banker with your documentation and your passport and everything. Dim Bulbs Everywhere. :-)
Action plan:
1. You or a trusted intelligent friend in the US gets explicit advance approval from a bank, credit card service provider, etc. When Mama's happy, everybody's happy. Bank = Mama.
2. Then solve your tax questions by figuring out how you will sell from Jamaica through your US corporation and through to your US customers, then follow the trail of money back from the customer's credit card through the merchant account to your bank for your US company, then onward to the bank account of your Jamaican company. The path of least resistance (until your revenues push $1 million or so) is to configure your US company to show a modest profit and pay modest tax, with the bulk of profits earned in Jamaica.
US international tax rules are written as if every company is the size of Mitsubishi. Be careful not to be strangled with government-mandated overhead in the form of accounting and legal fees.
I am simply charging customers for access to a web app. So no buying or selling or transferring of ownership/title will be done.
Think 37signals type pricing model...except that I want to be able to easily access the cash that accrues in my bank account in the US :)
My bank account needs are relatively trivial. Just accepting funds from my merchant account, and doing electronic international wire transfers (which I know a number of financial institutions do, e.g. Bank of America).
So no credit lines, no credit cards, etc....yet.
More than likely, when I am ready for those, I will likely just engage my local bank here.
If my US corporation does the 'selling', i.e. the web app is owned by the US corp, and the US corp is wholly owned by the Jamaican corp, can't I 'expense' a transaction - e.g. licensing fee or something - and leave the US corp with a modest profit and pay the taxes on that?
Is this all worth it? Should I just setup a paypal account to work with my Jamaican credentials, and accept money there and go that route first, then move to the merchant account with US corp after I generate a significant amount of revenues?
Thanks for the help by the way, really appreciate it.
And I know this isn't real 'legal advice' and I will corroborate our discussion with 'advisors', if & when I get them - and you will not be held liable for any stupid things I do :)
You can do that via an agent. You can find one by googling 'Delaware Inc' or 'Delaware LLC' or by looking at the official list of registered agents at http://corp.delaware.gov/agents/agts.shtml. It usually costs around $200-$300 per annum for the basic service.
Delaware does provide some advantages over other states in certain circumstances. A lot of major companies are incorporate there, and so a lot of important lawsuits involving corporate law have been fought there, and so their law is well studied and understood. Their court system also is friendly toward corporate litigation, expediting things so suits don't languish on the calendar.
Delaware also makes a lot of money from fees and such on corporations incorporated therein, and so has tried to make their law friendly, to encourage companies to incorporate there.
If you are a large public company that expects to be involved in a lot of litigation against other companies or expect to get sued a lot by your shareholders and investors, it can make a lot of sense to incorporate in Delaware.
For nearly everyone else, there's no particular advantage to Delaware. It's generally best to just incorporate where you actually are or where you will be doing most of your business. Even some large companies do this. Microsoft is incorporated in Washington, for example.
Those were the main reasons, but I will look into it, given your feedback.
My main reason for incorporating in the US, is to get a US bank account, US merchant account, etc. - which makes everything much easier when dealing with other US companies.
Thoughts?
Same thing is true for your merchant account.
Once you jump those practical hurdles the next question is tax. Are you "doing business" in the US or not? This is going to drive your US tax exposure. This is at a Federal level as well as state level.
Once you understand the tax implications -- then you probably form the company and start making money.
Consider also the overhead of having the Delaware (or other location if preferable) corporation. I figure you should budget $3,000 per year in overhead to keep it afloat. Filing fees, accounting fees, legal fees, etc. That's with minor business operations.
I am trying to get my bank account setup first, if there was a US based bank that allowed me to setup a regular business checking account using foreign credentials, I would definitely prefer that route. Do you happen to know of any that I can try?
Never considered that just having a presence in Delaware would run me about $3K/year. That's interesting.
Is this a company that already exists? If so, registering it doesn't make any sense. (Again, please correct me if I'm wrong.)
Are they really good for this type of thing?