Myth 1: Nevada Corporations do not have to pay Personal Income Taxes

This is true if and only if your Nevada Corporation or LLC is operating in the State of Nevada. For Example: If you have a Nevada Corporation that is located and conducting business in say California, your Nevada Corporation will still be responsible for paying California State Income Taxes.

A Brief Explanation:

This "Myth" has come about primarily because of the fact that Nevada does not impose a personal income tax. The majority of Nevada's tax revenue is actually collected from the Gaming Industry. This has afforded the State of Nevada the ability to provide a favorable income tax structure.

Unfortunately, these are tax laws and not a part of the corporate laws Nevada has adopted. In the legal sense, tax laws and corporate laws are two completely different animals. When you incorporate in Nevada and operate in another State you inherit Nevada's corporate law structure only, not its tax laws.

Myth 2: The Nevada Secretary of State does not share corporate/officer information with the IRS

Not True. What this should say is "The Nevada Secretary of State does not directly share information with the IRS"

A Brief Explanation:

It is true that the Nevada Secretary of State does not directly hand Corporate/Officer information over to the IRS. That being said, just because the Secretary of State is not giving the information directly to the IRS does not mean the IRS is not able to get the information they want. For example, the names and addresses of Corporate Officers are public records and they can be accessed by anyone, at any time, on the Nevada Secretary of States web site.

One of the most important things to keep in mind is that, while the information the IRS can obtain from the Nevada Secretary of State is limited to Names and Addresses of Corporate Officers, they have many other ways of getting what they want. For example: When you incorporate in Nevada, or any State for that matter, you will need to apply for an EIN through the IRS. This process requires that you provide a Social Security Number of one of the Corporate Officers. In doing so, you have just provided the IRS with your personal information.

Myth 3: In order for my Nevada Corporation to be official, I need a mailbox or virtual office in the State of Nevada

This is not true. The only law relating to a physical presence in the State of Nevada is the law that requires each Corporate Entity to have a Registered Agent located in the State to accept Service of Process. There are no laws that require a mailbox or a virtual office to hold board meetings.

A Brief Explanation

There are many companies out there which provide Nevada Incorporation and Nevada Registered Agent Services. Many of these companies also offer a wide variety of other products and services. Unfortunately, some of these companies want you to purchase these other products and services so bad that they are not going to be fully up front and honest with regarding whether or not you actually need this service.