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A comment on Stripe Atlas for LLCs. Parent comment

Re:Stripe Atlas for LLCs by ryanSrich on Monday April 30, 2018 @05:06PM (#16962349)
CA in general makes absolutely no sense to start a business in. There are zero arguments for starting a business in CA. Oregon, Washington, Texas, Colorado, etc. are all objectively better choices. Even if you're interested in raising money from SV investors you're far better off locating in Seattle, Denver, Portland, Austin, etc.
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Re:Stripe Atlas for LLCs by Meekro on Monday April 30, 2018 @06:10PM (#16962880)
I definitely agree with you that there are better states than California, but I recently moved my online company from California to Texas and discovered a really nasty surprise: Texas considers web hosting, server rental, SaaS, etc. to be services subject to sales tax [1]. Washington actually does as well, since you mentioned it.

This will complicate your life in two ways: First, your internet company now has to enumerate subscribers in the same state as you and charge them sales tax. Your competitors, located in friendlier territories, can undercut you by not having to do this.

Second, any payments you make to a SaaS/hosting vendor are now subject to use tax. Do you pay AWS for hosting every month? Get ready to cough up ~6% of that for Texas' treasury. If you're running the kind of business where your hosting bill will grow proportionally to your revenue, this amounts to a tax on revenue. In my case, it wildly exceeds anything California ever charged me in income tax.

[1] https://blog.taxjar.com/saas-sales-tax/

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Re:Stripe Atlas for LLCs by lenjaffe on Monday April 30, 2018 @06:39PM (#16963122)
> this amounts to a tax on revenue.

Corporations wanted to be people. People pay income taxes on their revenue, not their profits.

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Re:Stripe Atlas for LLCs by 20after4 on Monday April 30, 2018 @10:15PM (#16964141)
What about deductions?
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Re:Stripe Atlas for LLCs by geofft on Monday April 30, 2018 @08:08PM (#16963635)
"I have social connections and support structures in California" sounds like a pretty good reason to me. Starting a business, paying extra taxes, and being willing to stick with it for the long term sounds better than being lonely and giving up 6 months in or deciding not to start it at all.
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Re:Stripe Atlas for LLCs by knicholes on Monday April 30, 2018 @05:41PM (#16962686)
You forgot the lovely deseret (#2!) of Salt Lake City! https://www.cnbc.com/2017/07/21/the-top-15-cities-in-us-to-s...
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Re:Stripe Atlas for LLCs by caust1c on Monday April 30, 2018 @06:05PM (#16962850)
Except you know, California Labor Code section 2870...

https://leginfo.legislature.ca.gov/faces/codes_displaySectio...

I'd be happy to know about other states which have similar laws.

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