Oregon is the 33rd state of the United States of America and attained this status in February of 1859, having adopted a constitution which was drafted in 1858.
Situated in the Pacific Northwest, Oregon has regular and easy shipping links with Asian markets. The large state of California is on its southern border and therefore Oregon has been beneficiary of the influx of high-tech industries to that area of the US.
A highly diversified economy has brought economic success to Oregon though they have suffered from Governments Land Use Regulations which restricts the use of the timber resource on Federal Lands. The production of lumber and plywood are two of the major industries and has experienced a downturn due to these policies.
The Dot.Com phenomena of the 1990's also had its draw back when the sector went into recession during the late 1990's and early 2000's. With the passage of Limited Liability Company Legislation, Oregon hopes to strengthen its service sector with this relatively unknown but advantageous form of business organization.
Limited Liability Company (LLC)
The Limited liability Company became an accepted and a popular form of business organization in 1988 when the Internal Revenue Service (IRS) regularized the tax treatment of an LLC and made it eligible for "pass-through" tax status while still affording the members (owners) personal protection on their assets and private wealth.
The unique nature of an Oregon registered Limited Liability company provides the benefits and advantages of other forms of US business organizations without most of the restrictions inherent in them. Most importantly for the person or group who wish a US company which provide a status very similar to a traditional Offshore Corporation (IBC) registered in an Offshore Tax Haven, the US LLC is tax free on business transactions outside the US and whose members are US non-resident aliens. It is sometimes referred to as an Oregon offshore company or Oregon offshore LLC.
Features and advantages of an Oregon Limited Liability Company
- The name of an Oregon LLC must not bare any similarity to an existing company registered in Oregon and must end with the words "Limited Liability Company", "Company", "L.L.C." or "LLC".
- A registered agent with a registered office, with a street in Oregon is required. You may wish to have an office with an address where mail may be directed. We will provide these services.
- The Registered Agent will prepare and file the Articles of Organization with the Oregon Secretary-of-State, at which time the Limited Liability Company will legally exist.
- An Oregon LLC is a legal business entity and treated as separate from its owners.
- The LLC does not issue shares therefore does not have shareholders. Its owners are members of the LLC.
- An Oregon LLC may be organized with a minimum of one member.
- The members of an Oregon LLC usually manage the business. The authority of the members is normally in direct proportion to their interest in the profits of the LLC.
- A manager may be appointed if this option is found to be convenient.
- The manager may be a member.
- There is no Board of Directors. The manager is directly responsible to the members.
- An Oregon LLC is owned by its members.
- Non-resident aliens and/or companies may fully own an Oregon LLC.
- The LLC may also be owned by Corporations (companies limited by shares), other LLC's, Partnerships, Trusts, Pension Plans, Charitable Organization and US residents.
- There are no restrictions as to the number of members and their residence or citizenship.
Liabilities and Obligations
- An Oregon LLC offers asset protection to its owners. The Limited Liability status ensures that debt and other obligations are the sole responsibility of the company.
- An Oregon LLC is a tax free business entity.
- Income from the distribution of profits to the owners is taxed on the Personal income basis of the owner.
- If no income is derived from doing business or trade within the US, the non-resident alien members are not liable for United States tax and do not have to file tax returns.
- It is recommended that when organizing an LLC, non-resident members should be physical persons. IF it is formed by non-resident legal entities, such as companies or corporations, the LLC may be considered by the IRS as a branch of a foreign company in the US and the LLC will therefore be taxed on its worldwide income.
- Income is said not to have been derived from the United States, providing that:
- The LLC is not effectively connected with trade or business within the United States.
- It does not employ US residents on a permanent basis.
- It does not rely on a dedicated place of business within the United States. This does not apply to an office which is infrequently used.
Meetings and Records
- Meeting of the members of an Oregon Limited Liability Company is not a statutory requirement. The members may meet if necessary anywhere and by what means they choose.
- Accounts and other records do not have to be filed with the exception of Form 1065, which is filed with the IRS annually, to ensure US residents properly report their income.
An Oregon LLC may have a life in perpetuity. Conditions for the sale, transfer or disposition of a member's interest should be set out in a Members' Agreement.
Nominee members may be used in an LLC and we provide this service.
The Oregon LLC is a good vehicle for non-resident aliens to earn tax free income utilizing a US business entity, but not conducting its business in the USA.
Oregon LLC's are not known by tax authorities outside the US, compared to Delaware LLC's, which are often used to minimize tax liabilities.
If you require an American entity but do not want to attract additional attention, the Oregon LLC will be a wise choice.