Innovative Strategies For Winning Tax Controversies, Business Structuring And Estate Planning

Taxesq – IRS Audit and Business Tax Estate Attorney Cherry Hill NJ

by | May 9, 2003 | Uncategorized

This is a question I received today and is similar to many questions I receive:

I found your web site yesterday, and would like your opinion. I and my partners are interested in incorporating in Nevada for the purpose of privacy. We have been talking to Nevada Corporate Headquarters, and they assure us that a Nevada Corporation with Nominee service will ensure us complete privacy. Of the four partners, two would like to remain “silent”. One concern is that, in the event of a lawsuit, would Nevada law prevail and protect the names of these partners? Our business would actually be in Washington and surrounding states.

This is my answer:

Thank you for the note. Frankly, nothing will do what you want – complete privacy. Let’s make an example:

You setup Nevada Corp – Nevco. Inc. and want to do business in WA. You must file as a foreign corporation in WA. Even if there is a nominee owner, who will be the officers? Suppose the corporation is charged by a governmental agency with fraud. The officers and employees are arrested. In order to get bail, the court orders them to reveal the equitable ownership of the company. Your privacy scheme fails!

The best solution is to choose an appropriate entity in the state(s) in which you intend to do business