I worked for an employer who used the Bermuda shell corporation trick. To keep the IRS happy they had to actually do some real work in Bermuda -- it wasn't just a PO box. And let me tell you, it probably cost as much as it saved in terms of yahoos doing things suboptimally based on misunderstandings. It might have been something that could be cleared up with frequent trips to Bermuda for business stakeholders, but that would have cost some money too.