Delaware as a tax haven – Delaware is not only known for its business friendliness, but also for its favorable tax environment, which makes it a popular location for companies and investors. Delaware, as well as Florida, is known as a tax haven. Learn more about the advantages of Delaware as a tax haven, especially for German investors and entrepreneurs, and why some people are attracted to Delaware as a business location. Setting up a US company? Learn more about US legal forms here.
Delaware offers a variety of tax incentives for companies wishing to locate there.
Fact 1: No state corporation tax for companies without a physical presence
One of Delaware’s biggest advantages is that companies that operate outside the state and do not have a physical presence in Delaware are exempt from state corporate income tax. This is particularly advantageous for companies that operate on the Internet or have multiple locations in different states.
Fact 2: Low franchise tax
The franchise tax in Delaware is relatively low compared to other states. Businesses can choose how they want to be taxed based on their capital or stock. This offers flexibility and potential savings for businesses.
Fact 3: Protection of the corporate identity
Delaware has laws that protect the identity of business owners. This can be an advantage for investors who value privacy and do not want to make their personal information publicly available.
For the first two to ten properties, an LLC (see GmbH in Germany) is best suited to minimize liability risks and at the same time take advantage of tax benefits. The LLC limits the personal liability of the owners, while profits and losses are attributed directly to the shareholders, which avoids double taxation. In comparison, a Limited Partnership (see KG) offers more flexibility in terms of passive participation, but the general partner bears full liability. A general partnership (see OHG) involves higher risks due to unlimited liability.
US-Firmengründung speziell für Tax-Lien-Investoren
US-Firmengründung speziell für Tax-Lien-Investoren. Dieses exklusive Paket wurde speziell für deutschsprachige Tax-Lien-Investoren entwickelt und enthält alles Wichtige, was ein Investor benötigt, um seine Tax-Lien-Investments erfolgreich umzusetzen:
Delaware is also an attractive location for real estate investment, and the tax advantages make buying property there particularly attractive.
Fact 1: Low property taxes
Property taxes in Delaware are relatively low compared to other states. This makes owning real estate in Delaware economically attractive for investors and property owners.
Fact 2: No inheritance tax
Delaware does not levy inheritance tax or property tax, making it an ideal location for buying real estate for assets and estate planning. This is particularly advantageous for German investors who wish to own real estate in the USA.
Fact 3 Rental yields
Delaware offers a growing demand for rental housing, especially in cities like Wilmington and Newark. Investors can benefit from attractive rental yields while taking advantage of the state’s tax benefits.
Tax advantages for German investors in Delaware
For German investors, Delaware offers unique advantages that facilitate real estate ownership and business start-ups.
Double taxation agreement USA / Germany
The USA and Germany have a double taxation agreement that is designed to prevent German citizens from paying taxes on the same income in both the USA and Germany. This enables investors to avoid double taxation and make their investments more efficient.
Access to a stable market
Delaware has a stable economy and attracts many international investors. German investors can benefit from a dynamic real estate market and a diverse business environment.
Support from local authorities
Delaware has programs to support foreign investors, helping them to settle and establish their businesses in the state. This can be done through counseling services and networks specifically geared toward foreign investors.
My Delaware tax conclusion
Delaware has established itself as an attractive tax haven for businesses and investors, especially for German citizens. With its favorable tax system, absence of inheritance taxes and low property taxes, the state is an ideal place to own real estate and start a business. If you are a German investor looking to become active in Delaware, it is advisable to learn about the specific requirements and benefits and possibly consult a professional to make informed decisions.
Delaware or Florida: Tax comparison
Delaware and Florida are both attractive tax havens in the US, but with different advantages. Delaware offers companies no state income tax on profits earned outside the state and minimal reporting requirements, making it ideal for holding companies and shell companies. Florida , on the other hand, does not impose a personal income tax, which is particularly attractive to individuals and real estate investors. However, companies in Florida do pay a state corporate income tax, unlike Delaware.
My conclusion: Both offer tax advantages, but Delaware is better suited for companies, while Florida is more interesting for private individuals.
What types of company are there? If you want to set up your first US company, choosing the legal form is one of the first steps in the company formation process. Whether you want to set up a special real estate company or a start-up, we have summarized all types of companies in the USA for you here – with extra tips for real estate investments, of course.
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For the first two to ten properties, an LLC (see GmbH in Germany) is best suited to minimize liability risks and at the same time take advantage of tax benefits. The LLC limits the personal liability of the owners, while profits and losses are attributed directly to the shareholders, which avoids double taxation. In comparison, a Limited Partnership (see KG) offers more flexibility in terms of passive participation, but the general partner bears full liability. A 
