There are 50 states and 50 options when it comes to forming a Limited Liability Company (LLC). However, one state – Wyoming – stands out as the best state to form an LLC.
With an LLC, business income is generated as personal income for the owners and investors. As with a corporation, a Limited Liability Company enjoys limited legal liability that is equal to the amount of money invested by each partner.
a Domestic and a Foreign LLC
If you form an anonymous LLC in Wyoming, for example, that anonymous LLC will be considered a “domestic” Wyoming LLC, which entitles you to conduct business in Wyoming. If your Wyoming LLC wants to conduct business in Florida, you must register your LLC as a “foreign LLC’ in that state.
The best explanation for defining the two types of LLCs concerns the Internet. If you own a floral shop and intend to sell flowers just to local customers, then filing an LLC in your home state makes the most sense. Selling your beautiful floral arrangements online expands your customer base into other states, which makes filing to form an out- of-state LLC an option. E.g. Wyoming may become the right legal maneuver for your business.
Choosing the Best State to Form an LLC
Since an LLC forms according to the rules and regulations established by a state, the first decision on the road to forming an LLC is to select the best state to form an LLC. Although Delaware receives the most positive publicity with regard to forming an LLC, the fact remains that a state located out west is the better choice.
When you choose Wyoming as the state to form your LLC, you enjoy several benefits that enhance your bottom line, and it offers you the same legal protections as if you decided to form an LLC in your home state.
Why Wyoming is the Best State to Form LLC
Although not as popular for forming an LLC, Wyoming brings more to the table for business owners than what popular states such as Delaware and Nevada have to offer. Wyoming does not impose a franchise or a business income tax, which makes the state appealing for companies that want to expand operations by implementing a franchising business model. The state also grants lifetime proxy to business owners that provides more anonymity for business owners than what even Nevada grants its LLC formed businesses.
With an initial filing fee of just $100 and an annual report cost that sits at the low end for states at $60, Wyoming also has the strongest asset protection laws of any state in the country.
Here are some of the reasons why Wyoming is the best state to form an LLC:
- Corporate tax rate - 0 percent
- Individual income tax rate - 0 percent
- Sales tax rate - 4 percent
- Unemployment rate (March 2021) - 5.3 percent
- Average effective property tax rate - .61 percent
The national average effective property tax rate sits at 1.19 percent.
Get Legal Help Forming an LLC in Wyoming
As an experienced law firm that helps businesses form LLCs, Cloud Peak Law Group can provide you with several legal services to get your LLC up and running in Wyoming.
- A thorough review of your business information
- Filing of legal documents with the state
- Confirmation that your chosen business name is available
- Dependable compliance support
If you have decided to form an LLC, choosing the best state in which to form it is the most important decision you can expect to make. Working with Cloud Peak Law Group can make the process a profitable one for your business.