Wyoming is an exceptionally business friendly state as it boasts business friendly policies as well as a highly favorable taxation situation. This compares favorably to Australia as the nation has a 30% tax rate on corporate income which can be reduced to 25% if a business has an annual turnover of less than $50 million. Wyoming in comparison has no corporate income tax at a state level and no personal income tax. This makes Wyoming an incredibly appealing state in which to incorporate a business.

Wyoming Vs. Other Business Friendly States

While Wyoming is a highly business friendly state there are also other business friendly states such as Nevada and Delaware. However Wyoming is preferable to these states for a number of reasons.

Nevada

Nevada corporations are in many ways similar to Wyoming corporations but Nevada has a few drawbacks as a state for incorporation. Corporations in Nevada are subject to much higher annual fees for maintaining compliance with regulations and Nevada corporations are subject to certain taxes depending on the situation. A corporation in Wyoming can be maintained for under $100 a year and this includes a registered agent service and the annual reporting fee to the Secretary of State.

A registered agent is a necessary entity which all corporations and LLCs must maintain. This must be an individual or business in the state of incorporation with a non PO Box address who receives important documentation on behalf of the company. There are many companies that offer to provide registered agent services so an Australian corporation need not worry about not having a US address.

Delaware

Delaware is a well known state for business incorporation and this is driven by its business friendly nature and lenient tax policies. Delaware is however more suited to large and very large corporations as they have burdensome and expensive administrative requirements which can be overwhelming for a small to medium sized business. A Wyoming corporation provides similar benefits to that of a Delaware corporation while simultaneously requiring less reporting and other bureaucratic requirements.

Wyoming Privacy Benefits

Wyoming is a state with strict laws regarding privacy and this is further compounded by the relatively minimal reporting requirements on corporations. The Wyoming Secretary of State only requires that a corporation list a registered agent and the address of this registered agent for the purpose of document delivery. As previously stated, the registered agent does not need to be a member of the company and as such personal details of the company’s members does not need to be disclosed. Wyoming requires the filing of an annual report and these reports require an officer to be disclosed. However, a company may nominate an individual who is not part of the company to be the officer which further increases the privacy which Wyoming can offer a business.

Benefits of a Wyoming Corporation

The process of incorporation in Wyoming is straightforward and can be taken care of online for added convenience to business owners. This heavily streamlines the process of business incorporation especially for those who are unfamiliar with American law. The privacy granted to Wyoming corporations is guaranteed for the first year of incorporation and in subsequent years a business can use a nominated officer to continue this privacy.

Wyoming corporations provide limited liability asset protection. This means the corporation’s assets are protected from liability which the owner’s may incur in a personal capacity and the owner’s assets are protected from liability which the corporation incurs. This helps substantially with the mitigation of risk in starting a business and provides a great deal of personal protection from creditors. In combination with the privacy which Wyoming offers a corporation’s owners will be thoroughly insulated from creditors. As stated, Wyoming has no tax on income for persons or companies at a state level which is another tremendous advantage which the state offers to corporations.

Wyoming S Corporations

An S corporation is a straightforward and simple type of corporation and is the easiest type of corporation to form in Wyoming or elsewhere. This corporation type allows for what is known as pass through taxation in order to avoid double taxation. Typically a corporation is subject to double taxation as the corporation is taxed on its income and then the shareholders are taxed on the income which they receive through dividends. For a Wyoming S corporation this is not the case as the S corporation entity is disregarded by the IRS for tax purposes. This means that the profit and/or loss which the corporation incurs is passed through to the owners and they report this profit on their personal income tax return. Thereby avoiding double taxation due to no taxation levied against the corporation.

In addition to the benefits which an S corporation offers in terms of taxation they are also at a much lower risk of an audit. This is particularly true when compared to sole proprietorships.

Forming a Wyoming Corporation

While the process of incorporation in Wyoming has been streamlined for convenience and ease of use it is still recommended that a business use a service for this process. This is the case because there are certain technical elements of the application process which can be difficult especially if a business owner is unfamiliar with US law and Wyoming law. A service will also ensure that the privacy benefits which Wyoming offers are obtained as the service will be the corporation's registered agent and annual report officer. This not only increases privacy but convenience as well especially for businesses which do not maintain a physical presence in Wyoming.

Wyoming LLC Attorney - A best kept little secret?

This Wyoming law firm offers incorporation and registered agent services for very reasonable rates. They will incorporate a business into an S corporation for an initial fee of $199 which includes all the necessary documentation and legal processes. In addition to this they will draft corporate bylaws suited to any business on a business’s behalf which can be a massive timesaver. The initial fee also includes a year of registered agent services at no additional cost for increased convenience for any business.

Final Thoughts

Australian entrepreneurs can benefit from forming their corporations in Wyoming thanks to the state's fantastic business environment and lack of corporate taxation. Wyoming is a superior choice to other business friendly states thanks to its relatively low financial and administrative annual requirements. Additionally, Wyoming offers a great deal of privacy to business owners when establishing and maintaining their corporations. Wyoming corporations offer a straightforward application process which can be completed online for added convenience especially for people outside the US. Wyoming S corporations also avoid double taxation thanks to pass through taxation which will provide further savings on tax.