I recently read a very interesting article from BoatU.S. Magazine called “The Boating Myth That Won’t Die”.  With the economy still stagnating every state is revenue hungry and looking for uncollected taxes. Cruising boaters crossing state borders may find themselves in troubled waters if they linger too long in one area. The article was about a family who sailed their vessel on the eastern seaboard from Florida to Maryland. Along the way making stops in a few counties in North Carolina, when they arrived at their new home in Maryland they found mail from the state of North Carolina concluding they had personal property in North Carolina and therefore were subject to taxes in North Carolina.

I found the information below to be interesting in that typically clients will register their boat here in Delaware and cruise around the world docking in numerous parts of the world. Below is an excerpt:

A common misconception in recreational boating circles is that federal documentation of a privately owned boat by the USCG exempts the vessel from state registration, and thus taxation. This is NOT the case. In fact, most states require vessels kept in their waters for prescribed length of time, most commonly 60 to 90 days, to register and obtain a state sticker to indicate that the owner has paid the required taxes.” 

So the message to take from all this is make sure that if you’re cruising your vessel from place to place and are registered in another state beware of the length of time that you are stationed in each location as you could be subject to taxes.

Introduction

Due primarily to the high cost of electronic discovery, delay in reaching a final resolution and uncertainty as to the outcome, there is a consensus that civil litigation must be reformed. To address the concerns of business litigants, and to provide yet another option for the resolution of complex business disputes within Delaware’s highly regarded court system, the Delaware Superior Court has established a Complex Commercial Litigation Division (CCLD) effective May 1, 2010. To promote prompt and efficient disposition of complex matters, the CCLD will include a special assignment of experienced judges, tight case management orders to move cases to conclusion, special e-discovery orders to limit expense and avoid disputes and protocols to control expert witness and fact discovery.

Not every business dispute is eligible for the CCLD. To qualify, a case must: (1) include a claim with an amount in controversy of at least one million dollars, (2) involve an exclusive choice of court agreement or a judgment resulting from an exclusive choice of court agreement or (3) be so designated by the president judge. Cases that meet one of these criteria can be brought in the CCLD – a forum that is focused on addressing what matters to parties who file and litigate complex commercial disputes.

The CCLD was designed to address two principal concerns of business litigants: (1) the need for predictable procedures to control the course of the proceedings and to bring such proceedings to a prompt conclusion and (2) the need for reasonable control over the cost of discovery, including e-discovery. The CCLD addresses these concerns by following three primary case administration principles.

First, each CCLD case will remain with the same judge from start to finish. Second, each CCLD case will be administered pursuant to uniform procedures, including the requirement of an early Rule 16 scheduling conference for counsel to meet and confer with the judge. At the Rule 16 conference, a case management order will be entered that covers all phases of the case, including the handling of discovery disputes and dispositive motions, early mandatory disclosures and the exchange of electronic discovery. Third, each CCLD case will be assigned firm pretrial and prompt trial dates that will be given priority as among the panel judges’ other trial assignments.

To read the full article click HERE.

The total number of LLC’s filed in DE from 2004 to 2009 was 519,000. The total number of Inc.’s filed during the same period was 189,000. There were 329,000 more LLC’s filed in DE than Inc.’s in that six year period. The most dramatic increase in the LLC’s filed occurred between 2005 and 2007. Through that two-year period there was an increase of 40% more LLC’s filed when compared to 2004. In 2007, there were 112,982 LLC’s filed in DE versus 68,807 filed in 2004. The total number of Incorporations has fallen every year since 2005. The dramatic economic crisis which began in 2008 had an impact on each entity type; although the LLC still out paced the Inc. by more than 50%. Why are these numbers important? What can we learn from them?

Well, first of all when you consider that the Delaware Incorporation has been in existence since the 1800’s and the Delaware LLC since 1991 – this change has obviously occurred over a very short period of time. The LLC is now the most popular type of entity filed in America. In fact; according to the study, the LLC is being filed by almost 11 to one over the Inc. in some other states.

Business people from all walks of life are placing a great deal of trust in this relatively young corporate entity type. In the past, most business endeavors sought the structure of the corporation to provide stability. The security, flexibility and informalities associated with the LLC have made it an obvious choice for many entrepreneurs and investors. We now live in a world that is more litigious than ever and your business deserves ample protection as do you and your assets. The LLC can typically shelter any type of business or assets and provide separation for the individuals involved. It is very simple to operate and the burden of management associated with a stock company is greatly reduced.

However, the most important factor is still – trust. The LLC has withstood the legal challenges of the past 19 years and has established itself as a very worthy entity. Also, we can conclude that the LLC is helping many individuals and small groups realize their business potential. The LLC is very well suited for a more intimate business strategy. The privacy offered is also appealing to many; since we are all faced with the threat of identity theft in this age of immediate information.

Harvard Business Services, Inc. has been filing LLC’s since 1991. We know firsthand how valuable the LLC is to most business people. The LLC may be just right for you and if there is strength in numbers…..well you will be joining a very strong group!  We can help you file your LLC today.

Three words: Harvard Business Services.

For almost 30 years HBS has been forming and filing companies for entrepreneurs like you all over the world. We will make the incorporating process so easy and painless that in less than ten minutes you will officially have your own company. Below are a few answers to some FAQs.

How easy it is form a company in Delaware?

The hardest question we’re going to ask you is what you want to call the company. After that we will explain your options so you can decide between an LLC and an Incorporation. All we need is your contact information and payment. No signatures and No passports are required.

Is any of my contact information available for public record?

None of your contact information is available for public record and no one will know who is behind this company as we will file your company anonymously and we will not sell or release your information unless legally obligated to do so.

Do I need a physical address in Delaware or have to open a bank account in Delaware?

All you need is a Delaware Registered Agent like Harvard Business Services, Inc. No physical address is required in Delaware as HBS will be your Registered Agent to receive and forward service of process and other government documents, such as franchise tax reports, and notices. It is a legal requirement to have a Delaware Registered Agent.

Your company’s bank account can be opened anywhere in the world and is not required to be opened in Delaware.

Are there any taxes in Delaware or annual fees?

There is no sales tax in Delaware, there is no state income tax for corporations that operate outside of the State of Delaware and there is no inheritance tax. To maintain your company in Delaware there are two annual fees. The annual Franchise Tax is simply what you pay the State of Delaware for the right and privilege of owning a Delaware company and our annual Registered Agent fee – the lowest in the industry — is only $50 per year.

Does Delaware need to know the nature of business or where you are conducting business?

Delaware doesn’t need to know the nature of business or where you are conducting business. With a Delaware company you can operate business lawfully all over the world.

Graduates this year will not find a friendly market for jobs, yet opportunity is everywhere. Many successful entrepreneurs became mega-rich because they improved an industry they knew well. They followed their instincts. They invented something new or better than anyone else had ever thought of, so maybe you should consider forming your own company instead of looking for a job.

You could have the next million dollar idea such as the original whiz kids like Bill Gates or Steve Jobs. Put your own spin on success and maybe you will make a lot of money along the way like these folks did. For a list of successful young millionaires click HERE.

Want more information on “Why Delaware?” click HERE.

Want to know what makes Delaware so appealing? click HERE. 

Ready to start your own business? To get started click HERE or call 800-345-CORP (2677).

In its infancy the Court of Chancery was set up by the King of England to hear matters where no law was in existence to settle some disputes. Thus the King’s Chancellor was to hear the case and consider the fairness of the matter. This type of court does not exist in other legal systems and only three U.S. States have such a court. A court of equity differs from a court of law; matters before the Court of Chancery are heard as bench trials meaning that they are tried before a judge, alone. Without juries, judges are left to make rulings considering all issues of fact and law. For more than 200 years, the Delaware Court of Chancery has exercised exclusive jurisdiction over all matters and causes in equity in the State of Delaware.

The Court is comprised of one chancellor and four vice chancellors, all of whom are nominated by the Governor and confirmed for 12 year terms by the Senate. The five chancellors must all be well versed in law and must be Delaware citizens. The Delaware Court of Chancery has jurisdiction over a number of matters including commercial proceedings, real property, guardianship, and civil matters.

The majority of the litigation heard in today’s Delaware Court of Chancery consists of corporate, trust and estate matters.  The most notable power of the Court is its ability to issue injunctions and temporary restraining orders, and is most frequently exercised in corporate differences over mergers or acquisitions. A typical merger dispute will see a plaintiff seek temporary relief to preserve the status quo until a trial can occur. If the need should arise, the Court of Chancery may order issues of fact to be tried by a jury in the Supreme Court of Delaware.

With more than 200 years of judicial precedent, the Delaware Court of Chancery is hailed as the nation’s leading forum for settling corporate disputes, and is one of the most important reasons why Delaware is the most favorable environment for the world’s commercial affairs.