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I have a few applications that I am about to release on the App Store. I have not yet received any revenue from these apps. I'm also not planning on making a lot of money from them. I'm considering an LLC due to the nature of these apps.

I have a few questions.

I live in an Apartment in Miami, FL.

  1. Would it make sense to do a FL LLC or a DE LLC? And which would be cheaper in the long run? I don't plan on adding anyone to my company any time soon.
  2. Can I use my apartment as my business address?
  3. Must I already be generating revenue before I can form an LLC? I'd like to form the LLC first, so I can use that as the business name I'm registering with Apple.
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2 Answers

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1) Would it make sense to do a FL LLC or a DE LLC? And which would be cheaper in the long run. I don't plan on adding anyone to my company any time soon.

I recommend you register your LLC in your home state. In your case that would be FL. The reason is that if you register your LLC in any other state and are considered to be "doing business" in your home state, you will still have to regsiter your LLC in your home state as a foreign entity. That means that your LLC will be responsible for paying annual fees to two states, instead of just one had you simply registered in your home state.

Each state has their own definition of "doing business", but usually if you will be working from home, and have no other headquarter, that will be considered doing business in that state. For more information on this subject see my other answers:

2) Can I use my apartment as my business address?

Yes you can. However, keep in mind that most states consider an LLC's Articles of Organization to be public information. That means that if you use your home address it will become public information. You may, or may not, care about that. If this is an issue for you, you'll want to verify FL's laws regarding this matter. If you don't want your current address to become public record you may want to consider using a Registered Agent.

3) Must I already be generating revenue before I can form an LLC?

No. There is no requirement for this.

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I'd love to vote this up, but I can't w/o 15 reputation points. Thanks for the great answers. – Ron Garrity Jun 19 '12 at 18:37
@RonGarrity No problem. Glad I could help. We hope you continue to participate on this site, and earn the 15 rep necessary to upvote. Also, please see my edit; I added some additional resources for you. – Zuly Gonzalez♦ Jun 19 '12 at 18:59
I voted up for you (and me). – ron M. Jun 22 '12 at 18:10
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Specifically regarding Delaware Corporations.

From what I've read from multiple forum posts, blog posts, and talking to people, there's a cacophony of noise saying to incorporate in DE. One reason for this is that there's no state sales tax, so if you are selling products, they can be sold without tax (as far as I'm aware).

Another reason seems to be that the Delaware court system has two separate parts, one for family matters, another for corporate litigation (referred to as the Court of Chancery). http://courts.delaware.gov/overview.stm This court has developed a lot of consistent case law, from what I've gathered, so the judgements are more consistent and predictable.

These last advantages are somewhat limited, however, since from what I've read, you can be sued in any jurisdiction where you conduct business. That being said, you can put it in your terms of service that any disputes must be resolved in your home jurisdiction.

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While DE don't have taxes on the income derived from outside of DE, they do have taxes on DE income. You would also pay taxes in the jurisdiction you're actually doing business in. Taxes are not the reason, court system and legal system are. – littleadv Jun 20 '12 at 17:25

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