THE GUIDE TO Starting, Protecting, and Running a Business in the State of Nevada www.corpnet.com | 1.888.704.4830 | [email protected] TABLE OF CONTENTS BENEFITS TO STARTING A BUSINESS IN NEVADA . 3 Trending Industries in Nevada . 4 Challenges to Starting a Business in Nevada . 4 STARTING A BUSINESS IN NEVADA . 5 Choosing a Name for Your Business . 5 HOW TO REGISTER AND PROTECT YOUR BUSINESS NAME . 6 WHAT YOU NEED TO KNOW ABOUT LIABILITY . 7 YOUR BUSINESS STRUCTURE OPTIONS . 8 The Nevada Corporation . 8 Limited Liability Company . 9 Other Business Structures in Nevada . 9 WHICH BUSINESS STRUCTURE IS RIGHT FOR ME? . 11 How Many Shareholders Will You Have? . 11 Do You Plan to Raise Capital? . 11 What Sort of Profit Distribution Do You Want? . 11 How Much Paperwork Do You Want to Do? . 11 HOW TO FORM A CORPORATION IN NEVADA . 12 Is Nevada the Best Place to Form Your Corporation? . 13 HOW TO FORM A NEVADA LLC . 14 GETTING BUSINESS LICENSES AND PERMITS . 15 LAUNCHING YOUR BUSINESS . 16 PROTECTING YOUR BUSINESS . 17 Trademarks . 17 Copyrights . 17 Patents . 17 RUNNING YOUR BUSINESS . 18 Amendments . 18 Foreign Qualification . 18 Doing Business Under a Different Name . 18 Conversion of Business Entity . 18 Reinstatement . 19 Closing a Business – Dissolution . 19 Selling a Business . 19 KEEPING YOUR BUSINESS IN COMPLIANCE . 20 Disclaimer: CorpNet® is a document filing service and CANNOT provide you with legal, tax or financial advice. CorpNet is NOT a law firm. We are not your attorney, nor are we your accountant, nor are we a substitute for an attorney or an accountant, or any other professional service provider. CorpNet puts forth its best efforts to provide you with accurate and timely information. The information in this document reflects information compiled in good faith as of July 29, 2015. The information in this document is NOT GUARANTEED to be accurate and should NOT be relied upon for purposes of making business decisions that could have a financial or legal impact upon you. As such, the information provided herein is to be solely used as an educational resource and we strongly recommend you to seek the advice of an attorney or tax advisor should you need specific legal or tax advice. CorpNet®, CorpNet.com®, the image of the document with the orange arrow, and Business Information Zone(B.I.Z)™ are all Trademarks of CorpNet, Incorporated. THE GUIDE TO STARTING, PROTECTING, AND RUNNING A BUSINESS IN THE STATE OF NEVADA ©2008 – 2015 CORPNET, INCORPORATED. ALL RIGHTS RESERVED. INTRODUCTION Things are getting hot in Nevada, and it’s not just its broiling summers. Since the recession, Nevada small businesses have picked up momentum, and today, there are 573,000 small businesses with 100 or fewer employees. The state is quickly reaching near the number of small businesses it had prior to the recession in 2008. Benefits to Starting a Business in Nevada The great news is, the Nevada economy has never been stronger. To that end, the Nevada state government is offering tax abatements, transferrable tax credits, and reduced electricity rates to entice more people to start businesses in Nevada. The state also has ample small business resources, like NevadaSmallBusiness.com, which offers a slew of articles and webinars to help you start and grow your business. The Nevada Small Business Development Center provides education, training, and counseling for small businesses. And the Small Business Administration provides educational resources, as well as SBA-backed loans for small businesses. THE GUIDE TO STARTING, PROTECTING, AND RUNNING A BUSINESS 3 IN THE STATE OF NEVADA ©2008 – 2015 CORPNET, INCORPORATED. ALL RIGHTS RESERVED. Trending Industries in Nevada We’re seeing strong growth in several industries in Nevada, including: ● Tourism and Gaming: People flock to the state and spend millions of dollars on travel, entertainment, and, of course, casinos in Las Vegas and surrounding cities. ● Logistics: Nevada companies employ more than 66,000 people in this burgeoning field ● Manufacturing: Printing, publishing, and metals fabrication lead the way in manufacturing. ● Mining: They don’t call it the Wild West for nothing! 15,000 people work in this industry. Challenges to Starting a Business in Nevada Small business owners in Nevada face similar The Nevada obstacles to entrepreneurs elsewhere: government regulations, retaining good employees, and financial economy is stability rank among the challenges Nevada seeing strong entrepreneurs face. growth. Another thing to keep in mind when thinking about incorporating in Nevada is that the annual renewal fees there can be quite high. As part of their annual compliance requirements, the state will require you to pay fees anywhere from $350 to $650 a year. if your business is not physically located in Nevada, there is a good chance your company will still have to pay taxes in the state in which you are doing business. Not every company should incorporate in Nevada. If the bulk of your business is done elsewhere, you should make sure that forming your corporation or LLC in Nevada is the best choice rather than forming your business structure in the state where your company is physically located. THE GUIDE TO STARTING, PROTECTING, AND RUNNING A BUSINESS 4 IN THE STATE OF NEVADA ©2008 – 2015 CORPNET, INCORPORATED. ALL RIGHTS RESERVED. STARTING A BUSINESS IN NEVADA Since you’ve decided to start your company here, let’s dive into what you need to know to do so. Choosing a Name for Your Business One of the biggest and most important components of your business will be its name. The name is what people first encounter, whether it’s on the sign outside of your shop or on your website. To that end, you want it to be memorable, easy to say and spell, and set the tone for the kind of business you want to run. Here are some tips to help. 1. Consider How You Want to Be Perceived Ask yourself what the first thing is that you want a customer to think about with regard to your business. Do you want them to take you seriously? See you as playful? Edgy? Professional? Let that guide you to the right name. 2. Use a Descriptive Name The more specific you are, the better people know what you’re selling. For example, a potential customer will automatically know what ‘Ric’s Heating & Plumbing’ or ‘Carrie’s Cupcakes’ is all about, as opposed to just ‘Ric’s’ or ‘Carrie’s.’ At the same time, don’t get so specific that you box your brand in, should you decide to expand what you offer down the road. 3. Keep it Simple Powerful company names are easy to spell, pronounce, and remember. If a customer can’t remember your business name, she can’t refer you. And if she can’t spell it, she won’t be able to find your website. 4. Watch for Language and Cultural Pitfalls A business name like “Get Nailed” may not be the ideal name for a carpenter, funny though you may find it to be. The best way to avoid creating an embarrassing or damaging brand situation is to test your name on your target audience; they may tell you that they don’t understand your name, or even find it downright offensive. 5. Make Sure Your Name is Available You can easily check name availability by doing a free business name search through CorpNet for whatever county you are planning on conducting your business in. At this point, it’s also wise to use our free Trademark search application tool to see if the name is available through the US Patent and Trademark Office (you can see if anyone else has registered for, received, or abandoned a trademark for your proposed name). THE GUIDE TO STARTING, PROTECTING, AND RUNNING A BUSINESS 5 IN THE STATE OF NEVADA ©2008 – 2015 CORPNET, INCORPORATED. ALL RIGHTS RESERVED. HOW TO REGISTER AND PROTECT YOUR BUSINESS NAME It’s important that you protect your business name and make sure that it’s legally yours to use in the county you plan to conduct your business in. There are a few ways you can register a business name: ● If you are not planning on incorporating your business yet, you can register your name by filing a DBA (short for “Doing Business As”) with your county in Nevada. This is a simple and affordable act that will legally register your business name in that county. ● If you’re using any name beside your name (Ed Smith vs. Ed Smith Consulting), a DBA must be registered in order for any bank to open an account under that business name. If you are serious about protecting your brand and making sure no one else can use your business name, a trademark registration is suggested. We’ll cover that in a bit. THE GUIDE TO STARTING, PROTECTING, AND RUNNING A BUSINESS 6 IN THE STATE OF NEVADA ©2008 – 2015 CORPNET, INCORPORATED. ALL RIGHTS RESERVED. WHAT YOU NEED TO KNOW ABOUT LIABILITY Your small business can be structured in numerous ways. If you never created a formal business structure, then by default you have a sole proprietorship (one owner) or general partnership (multiple owners). These business structures are the simplest to form and manage, but there is one key drawback: there is no separation between the business owner and the business. If you own a sole proprietorship and your business is sued by a customer or vendor, then this is the same as being sued personally. All of your personal assets, savings, and property might be at risk in the court’s judgment. This isn’t meant to scare you, but rather make you aware of how you’re liwaable when you start a business: 1.