Leisure Resorts Corporation Nevada – Why So Popular?

September 16, 2004
By Richard Smith

As Reno and Las Vegas clearly show testament to, for decades now Nevada has been a Mecca for leisure resort. But why is it leisure resorts corporation Nevada so clearly prosper where other leisure resorts fail?

In short, Nevada would seem to be the ideal state for leisure resorts to prosper in for four compelling reasons:

• the state has zero-rate corporate income tax (a huge benefit if you are a service industry, which the leisure industry is);
• the state has some of the strictest corporate privacy rules, which coupled with the fact that it is almost impossible to pierce the corporate veil in Nevada makes this an attractive place of those involved in the leisure industry to invest;
• the state has very favorable gaming laws, and is also very accepting of other leisure-theme activities; such as fairly liberal beverage sales laws;
• the state is closely located to some of the bigger metropolis of the United States; for example California and Washington states.

Whilst all four of these reasons have undoubtedly underpinned the growth of the leisure industry in Nevada, it is possibly the first two of these that mean the industry continue to go from strength to strength. In this regard, following the decline in tourism dollars following 9/11, the Nevada industry, whilst being affected, has not felt the same repercussions due to the fact that leisure corporations incorporated in Nevada need not pay corporate income tax. This provides the industry with a good means of reinvesting earnings back into the industry to up-date and continue to entice customers to come to the state.

Finally, from an investors point of view, the leisure industry in Nevada is seen as particularly attractive because the huge earnings that can be generated are not taxed at a corporate level, nor are there any taxes on an individual level. As such, if you invest in such a corporation and are fortunate enough to receive a dividend check, the State of Nevada will not impose any personal income tax on you on such dividend payable. That said, if happen to reside in a state other than Nevada, you would need to check with your accountant to determine whether or not you need to pay any state tax – a matter simply resolved by means of establishing a Nevada corporation to take your dividend checks on your behalf!