Cheapest LLC Registration: Everything You Need to Know
Cheapest LLC registration can be one of the most important things to consider when forming your business. 3 min read
2. Forming an LLC in Another State
3. Forming an LLC in Delaware
4. Forming an LLC in Nevada
5. Forming an LLC in Wyoming
Cheapest LLC Registration
Cheapest LLC registration can be one of the most important things to consider when forming your business. You should take a look at the cheapest LLC registration states to help you determine which state would best suit your needs and the needs of your business.
Forming an LLC in Another State
While a Limited Liability Company, or LLC, offers many advantages, particularly with regard to the personal, limited liability protection, it might not be the best choice for every business. Furthermore, you might not experience the type of savings you would expect.
For example, if you operate a single-member LLC, you must elect to be taxed as either a corporation or sole proprietorship. Depending on which type of structure you choose to be taxedas, there might be additional tax liability that you didn’t expect to incur.
Therefore, before you choose to form your LLC, you should speak with an attorney who can discuss the goals and objectives of your business, and help you determine which type of business structure is best for your needs.
Forming an LLC in Delaware
Delaware is the most popular state for businesses wanting to register or incorporate. It has a reputation for being a business-friendly state. Furthermore, Delaware has a Chancery Court that solely handles business matters.
Such cases involve business disputes that are handled rather quickly in the state by a judge. This judge is very familiar with business matters, as opposed to some judges who might hear business cases with no real knowledge of business law. The Chancery Court doesn’t ever provide for a jury trial, which can also be beneficial to both parties in the legal dispute. Another benefit to operating a business in Delawareis the fact that the state is well versed in the history of corporations, as the state has incorporated businesses since the 1800s.
Delaware was one of the first states to privatize corporate entities. Thereafter, the state reduced restrictions and tax burdens on such corporations. From that point on, Delaware has become the most popular state for businesses to register and incorporate in. Notably, over 150,000 businesses were formed in this state in 2006.
Forming an LLC in Nevada
- No tax on business income, which is taxed in most states.
- No capital gains tax, which can reduce the tax implications of the LLC owners when filing taxes on their personal tax returns.
- No inheritance tax, meaning that if the LLC receives an inheritance from one of the owners or a third party, the business won’t be taxed on the inheritance.
- No franchise fees, which could save a company thousands of dollars.
- No information-sharing agreement with the Internal Revenue Service (IRS), which means that the LLC owners don’t need to provide their names when registering or filing any documentation with the state. They can remain entirely anonymous.
While you can remain entirely anonymous, keep in mind that a lawsuit arising due to potential fraud on the part of the owners could require the disclosure of your name. However, in any other legal suit brought against the LLC, the plaintiff won’t know who the owner(s) of the business are.
If you want to operate an LLC in the state of Nevada, you need not be a resident of the state or even a resident of the United States.
The state’s annual fees are quite low, as the annual fee is approximately $325, along with the principals’ list costing $125 and state business license costing $200.
The LLC meetings need not take place in Nevada, as they can take place anywhere you choose. This is especially helpful for owners who don’t live in Nevada or in the country.
Single-member LLCs are allowed, as is the ability for one person to hold all positions in the business. This isn’t allowed in all states.
Forming an LLC in Wyoming
Wyoming is another popular state for forming an LLC. Similar to the state of Nevada, Wyoming doesn’t have business income or franchise taxes. It has a lifetime proxy, meaning that it allows even more anonymity than Nevada. Through this proxy, anyone can privately vote through someone else who holds the shares of stock for that person.
If you need help learning more about the cheapest LLC registration states, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.