If you are thinking about starting your own business, it is important to take into account the start-up costs in relation to location. Different states have different tax rates and tax incentives that could prove to be valuable for your company. Which states are the most attractive for business owners? Below is a list of the most tax-friendly states for running a business.
The Top Tax Friendly States for Running a Business:
Wyoming has the lowest personal income tax and the lowest corporate tax rate in the nation. Plus, the state is among the top quarter of the country in terms of sales taxes. This means that business owners will be able to keep more of their personal and corporate income. The result? Extra profits can be reinvested into the company, as opposed to given to the government.
South Dakota offers some of the lowest corporate and income taxes in the nation, making it a great place to start your company. Property taxes are substantially lower as well. And, with North Dakota experiencing an oil boom, there may be opportunities for investment in both Dakota states.
Because of the extreme privacy laws, Nevada is considered one of the best states in the nation to start a corporation. Aside from the attractive corporate tax rates and other laws favoring businesses, this state draws in many tourists and retirees–and their dollars.
Did you know that residents of Alaska receive a check each year from the state? It’s true–the state pays each resident a share of state oil profits. While that may seem like a good enough reason to move your business to Alaska, it is also one of the friendliest states for businesses.
Low corporate and personal tax rates allow business owners and their employees to keep much of their paycheck. The state property taxes are among the lowest in America, as well.
While corporate taxes are slightly higher in Florida in comparison to the other states on this list, they have among the lowest sales taxes in the nation. With no income tax, state residents have more money to spend at Disney or at the beach. Plus, the year-round warm weather attracts workers from around the country.
Currently, the state of Texas is experiencing a significant economic boom. More and more businesses are starting up or relocating to Texas on a regular basis–from the healthcare industry, to oil and technology. “With no state income tax and little to no property tax, Texas offers a lot of incentives for business owners,” says John McDuff, a tax attorney practicing in Austin, Texas.
–Use This Information to Invest Better
Deciding on the location of your business is an important decision. You do not want to end up paying more than necessary in corporate or income taxes. The more money that stays within your own pocket or within your business checking account, the better off you will be. The extra profits can be used to pay employees, invest in the company, or invest in the economy at large.