It used to mean more than it does now. California has dropped this as a concept, and where it’s still used, it’s for tax and fees purposes. Some states tax corporations based on capitalization, and they use par value to assess that tax. So you should not just “pick a number”. Some of the fees and taxes can be very expensive, so proceed cautiously. Delaware, for example, uses par value.
What is “par value”?
About the Author: David Herzog
Since 1993, I have represented hundreds of businesses and individuals in a variety of industries. Small business legal advising . . . that's my thing.
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