USA Business Formation state to state question

[miniTycoon]

I live in PA and will start a retail business in a mall in MD. Is it better to setup the company in PA or in MD?

I am hoping to have other location in various states in the future.

 

[Werner Reisacher]

You are in the retail and consequently have employees. Do not link your legal entities. Set up a legal entity for each operation. Otherwise, you risk that any employee related issues that trigger audits by L/I or Sales Taxin will immediately trigger audits in all of the entities.

 

[Drmdcpa]

You generally need to set up a business in any state within which it operates. There would be no need to set up a PA entity for an operation that exists solely within MD.

If you set up in PA, you will still have to register in MD as a foreign business with activity in the state. If you set up in MD there is no need to register or set up in PA.

You should still be taxed in PA as a resident of the state even though the income is not earned there. But there should be offsets for imcome taxed in another jurisdiction.