Where to incorporate and online only business if it is multi-member in 2 seperate states?

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Where to incorporate and online only business if it is multi-member in 2 seperate states?

My sister and I are starting an online business but I reside in CO and my sister is in OR. The business is split 50/50 and although my sister has a lot to do with running the business she will also be handling all the operational components in OR such as the filings, accounting, and banking. I will be handling all of the marketing, etc. along with running the business. Does it matter which state we incorporate in? Should it be in CO, OR, both or in a different state all together?

Asked on June 6, 2017 under Business Law, Colorado

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

Contrary to popular belief, there is little or nothing to choose between in terms of where to incorporate: state laws in regard to corporations are all pretty much identical in every way that matters. Which one of you has easier physical assets to your state's courts? It is slightly more likely that a lawsuit against your business (if it is ever sued) will end up in the courts of the state in which it is incorporated, so you may as well go with the state where you can get into court more easily.


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