Setting up business in Idaho as foreign entity
Today I set up through NW Registry a Holding company in another state. Since we are physically located in Idaho but launching mostly digitally it was suggested we set up a Idaho foreign LLC under the holding company. We also would like to be able to do booths locally at events or even out of State to sell printed items. What is the best way to set this up and keep my name private as owner and have correct taxes?
Quick Answer:
To maintain privacy while ensuring tax compliance, the structure you described (Holding Company owning an Idaho LLC) is common.
**Privacy:**
To keep your name off public records, your Holding Company should be formed in a "privacy state" (e.g., Wyoming, Delaware, or New Mexico) that does not require disclosure of members/managers. This entity then acts as the sole member of the Idaho LLC. On Idaho’s filings, the Holding Company is listed as the owner, shielding your personal name.
**Taxation:**
For federal purposes, a single-member LLC is a "disregarded entity." Since the Holding Company owns the Idaho LLC, all income flows to the Holding Company. If you are the sole owner of the Holding Company, all activity ultimately lands on your personal Form 1040 (Schedule C).
**Sales Tax & Nexus:**
Selling physical items at booths creates "physical nexus." You must:
1. Register for an Idaho Seller’s Permit for local events.
2. For out-of-state events, you generally must register for a temporary or permanent sales tax permit in that specific state for that duration.
**Note:** If you are physically working in Idaho, Idaho considers you to have nexus there regardless of where the Holding Company is formed. You will owe Idaho state income tax on earnings generated while working in the state.
Note: This answer is provided for convenience only. It is important that you speak to a CPA about your individual tax situation.
