# Delaware LLC vs Wyoming LLC: A clear decision framework Michel Myara, Co-founder & Product Designer ยท June 19th 2026 Canonical: https://looch.money/blog/delaware-llc-vs-wyoming-llc --- Wyoming if you want privacy and low costs. Delaware if you plan to raise venture capital. That is the framework. The rest of this post fills in the details that determine which one fits you. Most guides either pick a winner without explaining why or hide behind "it depends." Neither helps you. The choice between Delaware and Wyoming comes down to three things: where you operate, what you plan to do with the business, and how much ongoing compliance you want to carry. Work through those three questions and the answer becomes obvious. --- ## Why this choice matters more than most guides admit The state you form in is your LLC's legal home. Its statutes govern your operating agreement, member disputes, and how courts treat your entity. It is not just a mailing address. The complication is that legal home and operating location are two different things. If you live and work in Texas, a Delaware or Wyoming LLC does not get you out of Texas's rules. Texas will likely require you to foreign-qualify your out-of-state LLC before you conduct business there. That means a separate filing, an ongoing registered agent in Texas, and Texas's own fees, on top of whatever you paid in Delaware or Wyoming. This is the number most comparison guides skip. They show you the Wyoming annual report fee and the Delaware franchise tax and compare them directly. They do not show you what happens when you add the foreign qualification layer that most founders actually need. --- ## What Delaware and Wyoming have in common Before the differences, here is what matters equally in both states. **You do not need to live there.** Both states allow non-residents (including non-US residents) to form an LLC. Neither requires you to have a physical presence in the state. **Your name stays off public records.** Neither state requires member names in the public formation filing. Delaware's certificate of formation requires only the LLC name and the registered agent, and the [Delaware Division of Corporations](https://corp.delaware.gov/) does not collect or store member or manager information. Wyoming's articles of organization, filed with the [Wyoming Secretary of State](https://sos.wyo.gov/), likewise do not require member or manager names, only the registered agent and organizer. Florida is the opposite: it requires a manager or authorized person to be named and that becomes public, per looch's [Start page](/start). So if privacy matters, Delaware and Wyoming both work and Florida does not. **You can get an EIN without an SSN or ITIN.** The IRS allows it through a third-party designee process. looch Start includes the EIN even when you do not have a Social Security number or ITIN, which takes roughly 4 days in that case. **Single-member LLCs are fully supported.** Both states allow a single-member LLC with no minimum capital requirement. --- ## Where Delaware wins ### The Court of Chancery and why investors care Delaware has a specialized court called the Court of Chancery. It handles only corporate and business disputes, with no juries, and judges who have spent careers on corporate law. The result is predictable, well-documented rulings. Venture capital and private equity funds care about this because they have seen what happens when disputes end up in front of a generalist court in a less developed jurisdiction. Delaware reduces that uncertainty. When a fund has deployed capital into dozens of companies, standardizing on Delaware reduces legal overhead and speeds up due diligence. If you plan to raise venture capital or angel investment, your investors may require a Delaware entity. It is not universal, but it is common enough that forming elsewhere and then converting later adds friction at exactly the wrong moment. ### The Delaware LLC-to-C-corp path Many VC-backed startups convert from an LLC to a Delaware C corp before or during a fundraising round. Preferred stock, option pools, and standard investment agreements all assume a C corp structure. If you form your LLC in Delaware, that conversion is cleaner. The LLC is already domiciled in the right jurisdiction. The legal work involves restructuring the entity type, not also moving jurisdictions. If you already know you are going the venture route, you can also skip the LLC step. [looch Start](/start) forms a Delaware C corp directly at the same $249 all-in price as an LLC, with a VC-ready package (stock purchase agreement, IP assignment, and Section 83(b) election) included. Note that looch Start does not handle entity conversion or domestication itself: moving an existing entity between structures or states is legal work for a business attorney. ### Delaware annual LLC tax Delaware LLCs pay a flat $300 annual tax. There is no annual report required for LLCs, just the tax payment, due June 1 each year. Late payment triggers a $200 penalty plus 1.5% monthly interest. These figures come from the [Delaware Division of Corporations](https://corp.delaware.gov/). Delaware does not impose state income tax on LLC income earned outside Delaware. If your business operates entirely outside the state, you pay the $300 annual tax and nothing more at the Delaware level. (You still owe taxes wherever you actually operate.) --- ## Where Wyoming wins ### Lower ongoing cost Wyoming has no state income tax and no franchise tax. The LLC formation filing fee is $100. The annual report license tax is $60 minimum, or two-tenths of one mill on the dollar ($0.0002) of assets located and employed in Wyoming, whichever is greater. For an LLC with under $300,000 in Wyoming-sited assets, that means the $60 minimum. These figures are published by the [Wyoming Secretary of State](https://sos.wyo.gov/). For a small cash-flowing business with no Wyoming-sited assets, the annual cost at the state level is substantially lower than Delaware's $300. Over several years, that difference is meaningful for a business running on tight margins. ### Privacy by design Wyoming built privacy into its LLC statute deliberately. Member names are not required in the Articles of Organization or in annual reports. Only the registered agent appears in public records. Wyoming also has strong charging order protection for LLC members. Wyoming Statute 17-29-503(g) makes the charging order the exclusive remedy a judgment creditor has against a member's interest, and the statute names the "sole member" explicitly, so the protection is written to reach single-member LLCs and not just multi-member ones. Whether a single-member LLC delivers the same protection in any given state is a question courts have treated unevenly, which is exactly why Wyoming spelled it out in statute. Delaware's treatment of single-member LLCs is less explicit on this point. This is a real legal nuance: confirm how it applies to your situation with a business attorney before relying on it. If keeping your personal name out of business records matters (and for many founders it does), Wyoming was built for that. ### The simpler compliance profile Wyoming annual compliance is straightforward: file the annual report and pay the fee. There is no franchise tax calculation, no separate tax payment, no narrative report. For a sole operator running a simple business, that simplicity has real value. --- ## The foreign qualification reality (the thing most guides skip) Here is the section most comparison guides bury or omit entirely. If you form your LLC in Delaware or Wyoming but you actually operate in California, New York, Texas, Florida, or any other state where you have a physical presence, employees, or conduct business, you will likely need to foreign-qualify in that state. Foreign qualification means registering your out-of-state LLC with that state's secretary of state. Foreign qualification requires: - A filing fee in your operating state (this varies widely by state, so check your own state's secretary of state) - An ongoing registered agent in that state - Compliance with that state's annual reporting and fee requirements looch provides registered agent service in all 50 states. Adding a state costs $49/year. That covers the registered agent piece. But the honest math is this: the cost advantage of Wyoming over Delaware can erode quickly once you layer in foreign qualification fees for a high-cost state. A founder operating out of California who forms in Wyoming to save on annual fees may end up paying more in California foreign qualification than they save in Wyoming. The point is not that out-of-state formation is a bad idea. It is that the comparison has to include your actual operating state, not just the two states on the comparison chart. --- ## The decision framework Here is the actual framework. Use it. **Form a Delaware LLC if:** - You plan to raise venture capital or angel investment within the next two to three years - You expect to convert to a C corp at some point - Your investors or co-founders are already requiring it - You want access to the most established body of corporate case law for any future dispute **Form a Wyoming LLC if:** - You are running a cash-flowing business with no near-term investor plans - Privacy and low annual costs are priorities - You are a non-US resident and want minimal US compliance overhead - You do not have significant physical presence in a state that will require foreign qualification anyway (or the foreign qualification cost is low in your state) **Consider your home state LLC instead if:** - You operate only in one state, it is not Delaware or Wyoming, and you have no investor plans - The foreign qualification cost would wipe out any savings from forming out of state - You want the simplest possible structure Both Delaware and Wyoming give you privacy. Both let you form without living there. The investor-readiness of Delaware is the clearest differentiator, and it only matters if you plan to raise capital. --- ## How looch Start handles either choice [Form your Delaware or Wyoming LLC through looch Start](/start) for $249 all-in. That price includes the state filing fee, EIN application (even without an SSN or ITIN), and one year of virtual office: registered agent service, a business address, and mail scanning (3 pieces per year, plus unlimited state mail). For Delaware and Wyoming, your name and home address never appear in public records. After the first year, the registered agent renews at $49/year. If you need to foreign-qualify in additional states, each state is $49/year for registered agent service. looch covers all 50 states. By looch's own [published comparison on the Start page](/start), the same formation runs about $441 at Bizee, $587 at LegalZoom, and $507 at ZenBusiness once their add-ons are counted, against $249 all-in at looch. After formation, looch wraps the full operating layer around your entity. You get business accounts, Smartcards, real-time accounting, and looch Pay, all in [one platform](/features). looch Pay uses pay by bank built on Request for Payment (RfP), so you ask a customer to approve a bank payment and they confirm it directly. For more on how that works and what it costs, see [how small businesses cut card fees with pay by bank](/blog/pay-by-bank-for-small-business). Formation is day one. The platform is years one through many. --- ## Frequently asked questions ### What is the difference between a Delaware LLC and a Wyoming LLC? The core differences are cost, investor-readiness, and statutory design. Delaware has a $300 flat annual tax, a specialized business court (Court of Chancery), and is the standard choice for founders planning to raise venture capital. Wyoming has lower annual fees, no state income tax, no franchise tax, and was built with member privacy and asset protection as deliberate design goals. Both keep your name off public records. Both allow non-residents to form. ### Which is better for privacy, Delaware or Wyoming? Both are better than most states. Neither Delaware nor Wyoming requires member names in public filings. Only the registered agent appears publicly. Wyoming was specifically designed with privacy protection built into its LLC statute. If privacy is your primary concern, Wyoming has the stronger founding philosophy around it, but Delaware is also private in practice for LLCs. ### Can I form a Delaware or Wyoming LLC if I don't live there? Yes. Neither state requires you to live there or have a physical presence. You need a registered agent with an address in the state. looch provides that as part of the $249 formation package. ### Do I need to foreign-qualify my LLC in my home state? Probably, if you conduct business there. "Conducting business" typically includes having employees, a physical location, or regular transactions in a state. If any of those apply to your home state, check that state's requirements. Foreign qualification requires a filing and a registered agent in that state. looch can cover the registered agent piece for $49/year per state. ### Is Wyoming better than Delaware for small businesses? For a cash-flowing small business with no plans to raise venture capital, Wyoming's lower ongoing costs and simpler compliance profile are genuine advantages. The $300 Delaware annual tax is not large in absolute terms, but Wyoming's annual fee is lower, and Wyoming has no franchise tax. The decision gets more complicated once you factor in foreign qualification costs if you operate outside Wyoming. ### What is the Delaware franchise tax for an LLC? Delaware LLCs pay a flat $300 annual tax, due June 1. There is no annual report required for LLCs, just the tax payment. Late payment incurs a $200 penalty plus 1.5% monthly interest. Delaware does not tax LLC income earned outside the state. ### Does Wyoming have a state income tax for LLCs? No. Wyoming has no state income tax and no franchise tax. The only ongoing state-level cost is the annual report license tax, a $60 minimum or $0.0002 per dollar of Wyoming-sited assets, whichever is greater, per the Wyoming Secretary of State. ### Can I get an EIN without an SSN or ITIN? Yes. The IRS allows EIN applications through a third-party designee, which means a registered formation service can apply on your behalf without requiring your Social Security number. As stated in looch's legal disclosure, Simplicity Fintech Inc acts as a Third-Party Designee to facilitate the EIN application. looch includes the EIN in the $249 package even when you do not have an SSN or ITIN, which takes roughly 4 days in that case, and delivers your official IRS EIN confirmation letter (CP-575) through the in-app virtual office, per looch's [Start page](/start). ### Which state is better for non-US residents? Wyoming is generally the easier choice for non-US residents. Lower annual costs, simpler compliance, and a statute built for privacy and flexibility. Delaware makes sense for non-US founders who are targeting US venture capital specifically. In either case, looch can file the entity and obtain the EIN without requiring an SSN or ITIN. ### Can I convert a Wyoming LLC to a Delaware LLC (or vice versa)? Entity conversion or domestication (formally moving an LLC from one state to another) is legally possible in many states, but the process varies and looch Start does not currently handle it. For a conversion or domestication, work with a business attorney. The other path is dissolving the existing entity and forming a new one in the target state, though that has its own tax and operational implications. Either way, get advice before moving an existing entity. --- *This post covers general formation considerations and is not legal or tax advice. Formation rules, fees, and compliance requirements change. Confirm current fees and requirements with the relevant state agencies and consult a qualified attorney or accountant for your specific situation.*