When you incorporate in Delaware, the corporation benefits from a very low State tax rate on corporate income and from favorable laws regarding corporation liabilities.
However, I think land banking partnerships are often structured as Subchapter S corporations where all income flow directly to the partners/investors. So, corporate income tax liability is not an issue, since in this case there would be none. From this standpoint, state tax considerations may not be very material.
In land banking, the main ongoing tax investors bear is annual property tax on the vacant land. Property tax vary at the local county level, nevertheless property tax rates are somewhat dictated by State fiscal policies.
Below is a list of the States with the lowest and the highest property tax per capita. So, this will give you an idea where to conduct business.
Best and Worst States: Based on data from the 2002 census, the following five states have the lowest local property taxes per capita/year. They are Arkansas ($191), Alabama ($285), Kentucky ($376), New Mexico ($380), and Oklahoma ($425). The states with the highest local property taxes per capita/year are: New Jersey ($1,871), Connecticut ($1,733), New York ($1,402), and Rhode Island ($1,369).
Nevertheless, in land banking the main focus is not so much on taxes (since they are pretty low overall) but on the outlook of the underlying land investment. This may have greater bearing on your State selection than tax consideration alone.
If my answer is unclear, let me know through "Answer" and I'll revise my answer accordingly.
DE
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