Comparing LLCs in Wyoming and Delaware

The main difference between Wyoming corporations and Delaware corporations is the cost. The taxes in Delaware, especially franchise taxes, are significantly higher than in Wyoming. Both offer essentially the same asset protection.

Though that is the short answer, both Wyoming and Delaware are among the most popular and advantageous choices for incorporation. If you are interested in forming a corporation, there are a few key differences that can help you decide which is best for you and your corporation.

Regardless of what you choose, we can be your registered agent in Delaware or Wyoming. We have physical offices in both locations and can open a free online bank account too.

Fortune 500 companies have long been drawn to Delaware thanks to its well-developed body of case law for corporations, reaching back over a hundred years and covering a wide breadth of matters regarding shareholders, management, mergers and acquisitions, and more. Delaware laws also have a tendency to favor management in shareholder disputes. Additionally, one of Delaware’s biggest draws when it comes to incorporation is its Court of Chancery. Unique to Delaware, this court focuses solely on business law, and the matters are decided by judges well-versed in business issues, rather than by juries.

However, even taking all of this into consideration, Delaware may not necessarily be the best place to incorporate your business. Choosing where you incorporate may depend more on the structure of your business and your long-term goals.

For example, if your business goals center around taking your company public and growing into a Fortune 500, then Delaware may be a suitable choice for you. However, if your goals are not quite this lofty, then you should be mindful of Delaware’s corporate income tax and franchise tax, along with several disclosures and reporting requirements. If these things are important to you or may have an adverse effect on your company, then you should consider incorporating them in Wyoming, which tends to be more appealing for small businesses and privately-owned companies.

Wyoming is one of only a few states known for being a tax haven for corporations. While Delaware does not tax corporate shares, Wyoming does not tax corporate shares, along with offering no state corporate income tax and no franchise tax. Similar to Delaware, Wyoming allows the formation of one-person corporations and does not have requirements for listing members or revealing stockholder information to the state. Wyoming, however, goes further in privacy matters by not collecting any corporate income tax information to be shared with the IRS.

There are a few additional benefits that make Wyoming attractive when it comes to incorporation. Compared to Delaware and many other states, Wyoming offers a very minimal annual fee. Additionally, Wyoming offers the option of continuance, which allows the moving of an existing corporation into the state of Wyoming, plus we have a Close Corporation for those wanting fewer formalities.

As was discussed above, both Delaware and Wyoming offer several benefits to those who have incorporated in their respective states. Generally, Delaware tends to attract larger corporations that can benefit from its well-developed legal system and Court of Chancery.

Wyoming, on the other hand, offers attractive benefits to smaller, privately held companies, such as increased privacy and fewer applicable taxes. Weighing these offerings against the needs and long-term goals of your business will help you determine which state offers the best future for your company.

If the Wyoming benefits are attractive to the needs of your business, you might consider enlisting the help of our formation service for Wyoming incorporation assistance. Additionally, we can serve as your incorporator for articles of incorporation filing. In some cases, we can also serve as the registered agent for your corporation. You may choose this option if you have privacy concerns, as the articles of incorporation are a public document.

If you have questions about our formation service please call us at +1 (307) 683-0983 or complete the contact form. Our paralegal team will be happy to assist. Below our answers to frequently asked questions about forming an LLC in Wyoming or Delaware.