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Advantages of Incorporating a Business in Idaho

What could be the best news for any business? A competitive market, opportunity for exports, high demand, and tax incentives! This is exactly what you will benefit from when you register a new company in Idaho.

The economy of Idaho is one of the strongest and extremely growth oriented due to the following factors:

  • Low taxes
  • Balanced state budget
  • Commonsense regulatory environment

The Bureau of Labor Statistics has ranked the state as 3rd when it comes to projected job growth rate while “The Tax Foundation” has ranked Idaho 2nd lowest in property tax in the nation.

Advantages of setting up an LLC or Corporation

As one of the top registered agents in the state, we can help you to register a new business in Idaho as this will ensure you are able to leverage all types of business gains and state provided incentives and grants. Let’s take a quick look at why Idaho is considered one of the best places for establishing a business:

Advantage#1: Salient benefits of Corporation or LLC formation

Corporation

  • Independent Life: One of the salient advantages of an S Corporation in Idaho is that it enjoys an independent life. The business entity will continue operation undisturbed even if it experienced incapacity of one or more stockholders or faced the death of one of its stockholders.
  • Investment Tax Credit: If you register a new company in Idaho then you can take advantage of this credit. The investment tax credit can offset almost 50% of your state income tax liability. It can also be carried forward for a period of 14 years.
  • Change in Ownership: If you have formed an S Corporation in Idaho then sale, purchase, as well as gifting of stock can facilitate changes in ownership. The changes can take place without disturbing the ability of the corporation to conduct its business.

LLC

  • Limited Liability: An owner of an Idaho LLC will be able to enjoy limited liability protection, which means claimants can sue the LLC and not the owner or investors.
  • Flow through Entity: When you register a new company in Idaho as an LLC, it is considered to be a flow through entity, which means the LLC will not be subjected to corporate income tax.
  • Flexible Profit Distribution: An LLC has the benefit of being able to select different ways of distribution of profits.
  • No Minutes of meetings: Unlike a corporation, an LLC startup company Idaho will not be required to maintain any minutes of the meetings or resolutions.

Advantage#2: Business Tax Credits

Are there any other benefits for small and medium sized enterprises? When you register a new company in Idaho, your business entity will be able to benefit from several state based incentives that not only enable growth but make your business sustainable as well. One of the most beneficial is the business tax credits.

There are several types of business tax credits that your entity can qualify for after you register a new business in Idaho. Some of the top tax credits benefitting small and medium enterprises include:

  • Small Employer New Jobs Credit: This credit targeted at a startup company Idaho can provides businesses with an income tax credit from $1,500 to $3,000, every time a new job is created.
  • Small Employer Capital Investment Credit: This is a type of credit for small businesses and it provides an income tax credit of 3.75 percent on any new equipment that is purchased in Idaho.
  • Investment tax credit: This is another credit targeted at small businesses or startup company Idaho and provides an investment tax credit of 3 percent for qualifying businesses.

Apart from the above mentioned programs, there are several other business incentive programs in Idaho including Idaho Opportunity Fund, Work Force Development Training Fund, Personal Property Tax Exemption, TIF (Tax Increment Financing), 100% Production Sales Tax Exemptions, and Idaho Prime Rate Loan Program among others.

Are there any Disadvantages of Incorporating in Idaho?

When you register a new business in Idaho, you can be rest assured that there is a wide variety of business incentives to leverage but are there any disadvantages? There are limited numbers of disadvantages that are dependent on the type of business you register for example: the disadvantage of an LLC is that it will get dissolved when a member dies or if it undergoes bankruptcy. Similarly, incorporation may lead to higher overall taxes. These disadvantages are far outweighed by the benefits and advantages of forming a business in Idaho.

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