Starting Buisness for Brother-in-Law in China

[xeox]

What is the name of your state? Florida

My Chinese Brother-in Law who is lives in China has asked me to register a buisness for him here in the USA. He wants to use the company name to produce automotive brakes in China and sell them in China. He's just wanting to use a USA company name because he said the brakes will be easier to sell in China because the people there want products from USA Companies. Not things made in the USA specifically, just a company that is in the USA. I'm wondering how legal this is and wondering if someone would be able to help me know if it is legal and if so how I would be able to do this for him? Are their any liablities I would face as the name would be in my name as I'm the only American Citizen.

Thank you

 

[clueless3]

I'm wondering how legal this is and wondering if someone would be able to help me know if it is legal and if so how I would be able to do this for him? Are their any liablities I would face as the name would be in my name as I'm the only American Citizen.

This is perfectly legal and being done all the time. As long as the company is willing to go through all the trouble to set it up, and pays its taxes to all countries in question, then it's fine.

Anyone can be a shareholder of an American company. If you are an American citizen then you can be its officer as well.

Contact your State Secretary to register the company name, set up an office somewhere, get a business license from your City, get a EIN from the IRS.

Then the company needs to qualify to do business in China. It also needs to set up to pay Chinese income tax. It's a lot of work, and bureaucracy.

As far as company liability goes, you can buy liability insurance, if you want to.

As far as personal liability goes, if you do it "properly," you yourself, as an officer of the company, shouldn't face personal liability for the company's action.

Make sure you file income tax for the company in the US (and in China), and for yourself.

You will need the advice of a lawyer who is the expert in international business to make sure that you do everything needed to satisfy all countries that the company does business in. You also need the advice of an accountant who is the expert in international business to make sure that all US tax forms are filled out, at the correct time. You will need a Chinese lawyer and accountant as well.

Question: Do you REALLY want to pay income tax for BOTH countries?? Is the American name worth so much more business that it is justified paying double the tax, and going through all the trouble??