Should you form your LLC in Delaware? We've collected the relevant information that will help you make this decision.
- Long history of corporate law and established rules
- Law favorable to business owners
- Minimal disclosure of owners
- Extra administration and expense to form in Delaware and operate in your home state
- Have to hire a registered agent in Delaware (we can help).
Cost of doing business
- $90 filing fee / $270 annual statement
Taxed as a partnership
- Minimal disclosure of owners to public
Forming an LLC in Delaware
Your official name for your LLC will need to end with one of the following signifiers (or abbreviation of): “Limited liability company”, “LLC”, or “L.L.C.” In addition, it is required that the name of your business is not intentionally misleading to consumers, for any reason. Your company’s new name must also be completely unique, and not deceptively similar to any other organizations name or trademarks. There are also certain restrictions placed on the use of several terms common to the financial industry. Do a FREE name search now.
The owners of an LLC are called “members.” The following information must be required regarding your LLCs members:
- Required number of members
Delaware LLCs must have at least one member or manager listed in their incorporation documents.
- Age restrictions
LLC members in Delaware may be of any age.
- Residence restrictions
There are no residency restrictions imposed on LLC members in Delaware.
- What information needs to be included in the articles of organization?
LLC Members in Delaware are not required to list their name or addresses in their articles of organization.
Requirements for the articles of organization
The articles of organization is a document that must be filed to form your LLC in Delaware. It must include:
Registered agent information
All Delaware LLCs must have a registered agent on file and submit their name and Delaware physical address which cannot be a P.O. Box. This agent will be required to be accessible during standard business hours and acts as the state’s point of contact with the company. Learn more about registered agents in Delaware.
Additional Delaware filing requirements
Initial Report deadlines
New LLCs in Delaware are required to file an Initial Report within six months of incorporation.
Professional service companies are permitted to form as LLCs in Delaware. However, the state does not recognize the professional limited liability company (PLLC) as a formal structure.
Delaware LLC taxation and fee requirements
There are several tax and fee requirements that must be addressed by LLCs in Delaware. They are as follows:
Delaware LLCs are generally taxed as partnerships. For more information regarding taxes in Delaware, it is advised that you visit the state’s official business related website.
Annual report requirements
While LLCs in Delaware are not required to file an annual report; they are required to file a Franchise Tax Statement each year before June 1st. The cost of this filing is currently $270. Ownership information is not disclosed to the public despite it being on the filing.
Tax identification numbers
Delaware requires an EIN (Employer Identification Number) for all LLCs that will have employees, and most banks will require one to open accounts. Delaware does not require LLCs to obtain state tax ID numbers.
Business license requirements
The business licenses and permits required in Delaware vary wildly depending on the county or municipality where your new LLC is located. If you would like to see more in-depth information on licenses and permits, please feel free to visit the content in our learning library that covers business licenses and permits.
Need a Delaware corporation instead? Click here.