Nevada State Corporation Laws - Working For Your Benefit

The Law - The Reason To Come To Nevada

December 29, 2004
By Tom SeFack

Nevada state corporation laws are very liberal. Namely, debtors enjoy more protection and advantages than they would under corporation laws of other states, and the protection against personal liability of officers and directors is broader and better. Nevada still permits bearer shares, whereas most other U.S. states recognized they have few legitimate uses and banned them. (Though tempting, it is best to avoid bearer shares where possible.)

To make sure the protection benefits and the tax savings are worth the incorporation fees and the costs of running your Nevada corporation, you have to follow the rules quite carefully. That is one of the reasons why it is highly advisable to utilize services of experts specialized in Nevada incorporation. Of course, you can incorporate on your own, which is not hard to do with Nevada Secretary of State internet-friendly incorporation procedures, yet only a specialist can guarantee the level of protection you are after.

Unless all legal aspects are met technically, many of the advantages of Nevada's liberal law will be lost. Among others, directors meetings have to be held and all required records and documents have to be kept. Nevada requires the current list of officers and directors to be reported, officers and directors can be one person. No residence requirements for company directors to be met.

Nevada courts have to recognize judgments made in other states. The direct consequence of this fact is that if you are sued in any other state, Nevada court will have to recognize the judgment without regard to Nevada corporation law. For example, if sued in Delaware, Delaware law and procedures apply. Nevada law applies on Nevada corporations and residents being sued in a Nevada state court on a Nevada cause of action.

Federal laws apply in Nevada, as in any other state. Assets held in Nevada are still subject to seizure, attachment or garnishment in the U.S. Federal laws, not Nevada laws, apply when sued in a federal court.