There is a small two-story building in Wilmington, Delaware, that is the registered agent address of at least 285,000 American and foreign businesses operating in the United States. The address at 1209 North Orange Street in Wilmington is the home to more companies than anywhere else in the world.
The building is called the Corporation Trust Center and is operated by CT Corporation, a subsidiary of a Dutch information services firm called Wolters Kluwer. This company provides registered agent services, which is an individual or business that accepts tax and legal documents and maintains corporate compliance for legal notices and annual report filings on behalf of a business.
The Corporation Trust Center’s address is the home to major companies like Google, Apple, Verizon, American Airlines, General Motors, Walmart, and Coca-Cola, to name a few. Hilary Clinton and Donald Trump even have registered companies through the Corporation Trust Center, as do foreign businesses such as Deutsche Bank.
The reason so many companies are incorporated in Delaware is because of the state’s General Corporation Law. More specifically, companies take advantage of a thing called the “Delaware Loophole.” This loophole allows companies to avoid paying state corporate income tax where they earn revenue since Delaware is one of only five states that doesn’t have a sales tax.
In 2012, it was estimated that $9.5 billion of potential taxes for companies had been avoided in the previous ten years due to the Delaware Loophole. These taxes would have gone to other states. It’s also very easy to register a business in the state even without showing identification.
There are more than one million businesses registered in Delaware, more than the entire state’s population. As of 2014, 65 percent of Fortune 500 companies are registered in the state, and 85 percent of fortune 500 companies have at least one subsidiary registered there.
Sources: DBpedia, The New York Times, University of Chicago, International Consortium of Investigative Journalists, The Guardian, Institute on Taxation and Economic Policy
