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Comment Taxes are not the reason (was Re:Dodgy statesmen) (Score 2, Insightful) 681

"I mean, corporations do this all the time...many companies incorporate in Delaware for the tax breaks they get, even while most of their manufacturing/business/warehouses are in other states."

That's not strictly true. While it is true that you avoid some state taxes (e.g. franchise taxes) if you incorporate in Deleware, that is not the reason most firms incorporate in DE.

The main reason companies incorporate in DE is to take advantage of favorable corporate law regarding how corporations may be governed. Things like poison pill statues, how boards are elected, limits on management liability, relaxed rules on board composition, etc. Tax avoidance is pretty minor since, you can't use your DE status to avoid any income, property, sales, or use tax.

- Rob

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