Aged Corporation Secrets

A shelf corporation is a term used to describe a corporation that was filed for previously but never used.

An example would be a corporation filed with the Secretary of State in any state but that was never actively used, it was kept on the “shelf”. Usually a company may file many corporations at one time with the intent of not using them but keeping them for resale at a future date. The older they corporation gets the more value it is perceived to have.

One of the reasons they cost more is there are fees associated with keeping the corporation current. The fees differ in every state, some states may cost $850 per year just to keep it active and some may only be $50 per year. These are things you need to weight when thinking of getting a shelf corporation. Depending on your goals it may or may not be an advantage to you to purchase a shelf corporation.

I have seen corporations over 10 years old being sold for $20,000. In my opinion there doesn’t seem to be an advantage of ever purchasing a shelf corporation over 2-3 years old. You may just be spending money on something that will not really provide any value to you.

One thing you definitely want to know is the history of the corporation. It may be a entity that was actually used many years ago and the owners let it lapse so it may have outstanding liens or debts against it. If you take it over you may become responsible for those debts, so always do your homework.

Technorati Tags: Corporations, Shelf Corporation