We evaluate Wyoming and Delaware LLCs based on fees, easy of setting up, privacy, asset protection, and annual maintenance. Regardless of what you choose, we can open a free business banking account for your company. We strongly encourage you to read our entire guide, however our executive summary is:
- Choose Delaware if you plan to convert your LLC to a Corporation eventually with the intent to raise investor funds, or choose it for the reputational benefits of being where Fortune 500 companies are. Don't choose it if you are cost conscious.
- Choose Wyoming in all other cases. The privacy and asset protection are stronger, along with lower fees. If you're a small business, don't have a staff to handle increased compliance and won't be raising funds, then Wyoming's simplicity and low cost are preferable.
After deciding on an LLC the question becomes... what is the best state to form an LLC? A majority of our clients choose Wyoming or Delaware, especially non-residents.
WY vs. DE
Formation Fees: Winner Wyoming
Wyoming charges $102 to file Articles of Organization online with the Secretary of State. The company is accepted immediately and you may apply for an EIN the same day and begin doing business.
Delaware charges $90 to file the Certificate of Formation with the Division of Corporations, but expedited processing is +$50 for 24hrs or $100 for same day. Those who decline faster filings often wait a week or more depending on the time of year, e.g. end of year filings and formations around tax season can lead to significant delays.
Ease of Setting Up: Tie
Both states allow you to file online and accept credit card. There is no meaningful difference in the filing process. If you choose our service, then we use the same order form and collect the same information in each case as well.
Neither state requires owners or managers to be listed. The LLC can be formed anonymously with only our information as your registered agent showing. We also provide a business address, email and phone number to act as the public point of contact.
This privacy applies both during formation and annual reports. You do not have to disclose personal information online if you don't want to. Learn more about anonymous Wyoming LLCs and anonymous Delaware LLCs using the respective links
Asset Protection: Wyoming
Single-Member LLCs enjoy charging order protection in Wyoming by statute. The corporate veil cannot be pierced except in select circumstances such as fraud. The legislature's aggressive asset protection focus has led Wyoming to be called the Switzerland of the Rocky Mountains.
This is not to say DE companies don't enjoy the corporate veil, but it's not as strong and charging orders are more enforceable. Further, Wyoming has complimentary trust law for asset protection and self-settled trusts which make us a haven.
Annual Report Fees: Wyoming
Delaware charges a $300 Franchise Tax which is due by June 1st. Even if you form December 31st, then this fee will be due.
Wyoming's annual report fee is $62 and is due the first day of the month in which you file the following year. For example, if you file in December, then the fee won't be due until the following December.
While the above shows Wyoming is generally the better choice, we have many clients in Delaware. Generally they opt for a Corporation so they can raise funds and grow their companies aggressively. There is also a prestige to Delaware for start-ups and founders.
These states are ultimately popular for location independent companies, holding companies, e-commerce, online stores, international founders and more.
Forming an LLC in Wyoming
You file Articles of Organization with the Secretary of State either online or by mail. Most companies may file online, but those containing prohibited words, such as bank or trust, must submit a paper filing.
You must have a registered agent, business address, mailing address and someone to sign as Organizer. Our service includes all these, plus an operating agreement, resolution to open a bank account and more. We can also setup your business bank account.
Forming an LLC in Delaware
You file a Certificate of Formation with the Division of Corporations. Filing online is fastest unless you have a prohibited word. There is a fee to expedite the filing so the process takes longer unless you pay.
You must have an agent and Organizer, but no business address needs to be listed. We include the operating agreement, resolution to open a bank account and more just as we do for Wyoming companies.
Note, we have an office in Delaware as well, so we do not resell registered agent services there. We staff the office and provide the same quality of service.
Wyoming vs. Delaware Corporations
Corporations are inherently more complex, but are necessary if you want to offer stock based compensation, raise capital from investors or need multi-level oversight of decisions, e.g. via a board of directors.
Delaware Corporations are best for anyone seeking outside capital. Wyoming is best for those seeking to minimize taxes and be anonymous. Learn more here about Wyoming vs. Delaware Corporations.
LLC vs. Corporation
Forming an LLC is the most popular option given the lower fees and simplicity compared to a Corporation. For reference, an LLC has owners and can choose to have managers. A Corporation must have shareholders, officers and a board of directors. This means significantly more paperwork.