| Whether you are looking to form an LLC or | | | | for non-retail business, small businesses are |
| thinking about business incorporation, there are 5 | | | | exempt from the franchise tax. Additionally, state |
| states with tax breaks that may be the perfect | | | | legislature gave small business a shot in the arm |
| location for your small business. For your | | | | by raising the revenue exemption level from |
| corporation or LLC have you considered? | | | | $300,000 to $1 million. The change took effect |
| South Dakota | | | | January 2010. |
| Texas | | | | The Big Sky State is one of only 5 states without |
| Montana | | | | sales tax. In fact, Montana is one of only two |
| Tennessee | | | | states that are currently operating in the "black" |
| Utah | | | | without a budget deficit (North Dakota is the |
| In 2009, South Dakota ranked #1 in the Tax | | | | other state). The unemployment rate in Billings is |
| Foundation's annual state-by-state ranking of | | | | 5%, half the national average. Corporate income |
| business tax climates. Why would South Dakota | | | | and property tariffs are also competitively low. |
| be such a great state to incorporate a business | | | | Next on the list of states with tax benefits right |
| or form an LLC? South Dakota has no personal | | | | for business incorporation or forming an LLC is |
| or corporate income tax. It is also one of the few | | | | Tennessee. Tennessee gives their residents a tax |
| states left that doesn't levy "gross receipts" | | | | break by not imposing personal income tax on |
| business tax on revenue. What you bank in sales | | | | wages and salaries. There is a down side to the |
| or profits, you keep. You can also count the sales | | | | state tax codes for LLCs and corporations. |
| tax as a plus. South Dakota has a relatively | | | | Tennessee levies taxes on corporate income at a |
| modest 4% sales tax rate. Side note, some | | | | rate of 6.5%. Also, if you're in the retail business, |
| municipalities add on their own toll taking the rate | | | | sales tax is on the high side at 7%. |
| as high as 6% in some areas. | | | | Utah offers more than just picturesque mountains |
| "Don't mess with Texas?" Well maybe you should | | | | and some of the best snow on earth. It is a |
| if you are thinking of incorporating a business or | | | | pretty good place to incorporate your business or |
| starting an LLC. The Lone Star state also has no | | | | form an LLC. Although it imposes all the usual |
| personal or corporate income tax. They actually | | | | taxes, including corporate and personal income |
| go as far as to forbid income tax in their | | | | taxes it has a simple tax code and relatively low |
| constitution. A spokesperson for the Texas | | | | rates. In 2008, Utah adopted a flat 5% personal |
| Controller's Office said "The spirit of | | | | income tax rate across all income brackets and a |
| entrepreneurship is inherent in the Texas business | | | | flat 5% corporate income tax rate. Utah tends to |
| community. The state has made a concerted | | | | be an employer "friendly" state, another reason to |
| effort not to be stringent." Although Texas has a | | | | consider it a good location for business |
| gross receipts or "franchise" tax of.05% of | | | | incorporation or to form an LLC. |
| revenues for retail business and 1% of revenue | | | | |