Delware Business Bank Account

[tren]

Hi,

I've incorporated a LLC in Delaware and have an EIN. All business transactions will be done over the net using paypal website payments pro and possibly other payment gateways. I'm an Australian citizen but am currently in the US and am willing to travel to delaware to setup a business bank account if necessary.

Can anyone who has done something similar in the past give recommendations on good banks for e-commerce and the information I'll need to set an account up? I can get a non-PO box address in Delaware which I think is necessary.

I have tried ringing the Delware National Bank, but they weren't very helpful. Wachovia bank also looks like it could fit the bill. If anyone could offer suggestions it would be much appreciated.

[KyleXY]

Why the hell do you need to set up a bank account physically in delaware. Why not just use any bank. People register businesses in Delaware all the time without having to actually go there and set up a PO Box or a physical bank there. That makes no sense.

[tyreandme]

Correct me if I am wrong, but if you form an LLC in Delaware, don't you have to do business from Delaware?

[KyleXY]

No, not at all. Delaware is probably the most heaviest business registered state in the US. Majority of the companies that register in DE don't even operate in DE in most cases. Most of them being high tech.

[tyreandme]

KyleXY,

Interesting... So when a business registers for an LLC in Delaware/Nevada, and they do business out of a different state, they are still considered as an LLC in the state they have not registered in? When I was doing a little research on this and looked into registring an LLC in Nevada (with $0 annual state LLC fee), I was told that I would nontheless have to pay the California state LLC tax ($800) since I was doing business in California as well, making registration in Nevada useless.

[KyleXY]

It's not useless. You pick a "home" state to register your business in, and then you register what is called a foreign LLC in the states you operate out of. So let's say you register your business in Nevada but then live in CA, you would register your home business in Nevada and register a foreign LLC in CA. Foreign because it's home is located in Nevada, not CA. Aka it's registered in both states. It's important to note it should be registered as a foreign LLC and NOT an LLC. Otherwise you have two companies sharing the same name from different states. A foreign LLC registration means the Nevada company is trying to do business in CA as well. Big difference.

You do have to pay the franchise LLC tax which is $800 either way (for CA example) but the point of registering in a different state isn't to avoid paying those fees. That's illegal to begin with. The point is to take advantage of the state's laws regarding how your business operates. The home state determines the majority of how your company operates. Examples of companies that have their home company registered in a different state than where they are headquartered is Google and Facebook (both Delaware companies).

My companies are all Delaware companies. Delaware is best for high net worth growth companies, typically C-Corps. Nevada is notorious for LLCs. That doesn't mean you can't do an LLC in Delaware too. Research the topic a bit more. There are plenty of rules around business structures, where they operate out of, and what you can and can't do with them depending on your business. Delaware and Nevada just happen to be two of the most business friendly states and makes things easier to process among other things.

I do also want to make a quick note from my understanding of these two states specifically, is that neither Delaware nor Nevada requires a bank account to be opened or meetings to be held in the state. Neither state requires a physical office, or mailing address be maintained other than a registered agent address.

That said, if you're going the LLC route, I feel Nevada is best, particularly if you're not building a high net worth growth company. Generally speaking if you were, you probably wouldn't have gone the LLC route figuratively speaking. But every case is situational. Here's an older post on here arguing in favor of Nevada for LLC (note that the tax thing for Nevada applies if you are in Nevada otherwise it's different).

[tren]

Hi Kyle,

It's my understanding (perhaps I'm incorrect), that to utilise paypal's website payment pro service, not only does your business need to be located in the US, but the bank account which the paypal account is linked to also needs to be in the US.

[KyleXY]

To be 100% honest I'm not sure on that rule but I do know they accept six different currencies: US Dollars, Australian Dollars, Canadian Dollars, GB Pounds, Euros, and Japanese Yen. Perhaps you can call their 1-800 number and clarify that. They should be able to answer this for you. The number is toll free.