Wyoming vs Delaware LLC is a comparison that can help entrepreneurs decide which of the two states is a better place for starting a limited liability company (LLC). An LLC is a business entity that provides liability protection for its owners while allowing them to pay taxes at the individual level. However, the requirements for forming and operating an LLC may vary from one state to another. Wyoming and Delaware both provide a conducive environment for doing business, but they have different benefits and requirements for LLC owners.

Wyoming vs. Delaware: Forming an LLC

If you are planning to form an LLC in Delaware or Wyoming, you may have difficulty choosing between the two states. Both of these states provide a business-friendly environment, but each has different advantages and disadvantages depending on the legal structure, size, and nature of your business, as well as other factors. For instance, many large corporations choose to be formed in Delaware because of its business-oriented legal system. However, a single-owner corporation may be attracted to Wyoming's low taxes and fees.

Wyoming is the state where American LLC was invented, so it has been in the game longer than Delaware. Having established itself as a popular destination for incorporation since the early 1990s, Delaware is now home to many Fortune 500 companies.

If you are a small business owner, starting a company in Wyoming has distinct advantages. Wyoming only requires you to pay a minimal filing fee and an annual report fee of $50 in most cases. In addition, you do not have to pay state income tax and franchise tax. Delaware, on the other hand, is more geared towards large corporations because it provides better legal protection for shareholders and directors.

Wyoming vs. Delaware: Requirements and Regulations

  • State corporate income tax:
    • Wyoming – No
    • Delaware – Yes
  • State personal income tax:
    • Wyoming – No
    • Delaware - Yes
  • Tax on corporate shares:
    • Wyoming – No
    • Delaware – No
  • Franchise tax:
    • Wyoming – No
    • Delaware – Yes
  • Minimal initial filing fee:
    • Wyoming – Yes
    • Delaware - No
  • Minimal annual fees:
    • Wyoming – Yes
    • Delaware – No
  • Single-owner corporation allowed:
    • Wyoming – Yes
    • Delaware – Yes
  • Stockholders revealed to the state:
    • Wyoming – No
    • Delaware – No
  • Annual report required one year after the incorporation date:
    • Wyoming – No
    • Delaware– Yes
  • Filing of initial list of members or officers with the state:
    • Wyoming – No
    • Delaware – Yes
  • General business license required:
    • Wyoming – No
    • Delaware – No
  • Unlimited stock of any par value allowed:
    • Wyoming – Yes
    • Delaware – Yes
  • Nominee shareholders allowed:
    • Wyoming – Yes
    • Delaware – No
  • Share certificates required:
    • Wyoming – No
    • Delaware – Yes
  • Minimum capital requirements:
    • Wyoming – No
    • Delaware - No
  • Meetings can be held anywhere:
    • Wyoming – Yes
    • Delaware – Yes
  • Directors, officers, employees, and agents statutorily indemnified:
    • Wyoming – Yes
    • Delaware – No
  • Adoption of a corporation established in another state allowed:
    • Wyoming – Yes
    • Delaware – No
  • Collection of corporate income tax information for sharing with the IRS:
    • Wyoming – No
    • Delaware – Yes

Wyoming vs. Delaware: LLC Fees

In both Wyoming and Delaware, you are required to pay a filing fee to start an LLC. The fee is $100 in Wyoming and $90 in Delaware. In Delaware, a same-day service is available for an additional fee of $100. This kind of service is unavailable in Wyoming. If you wish to change your Registered Agent, you do not have to pay a fee in Wyoming. In Delaware, you will be charged a fee of $50.

According to the Wyoming Business Division, an LLC is required to pay a fee when it files an annual report. The fee is either a fixed fee of $50 or calculated at two-tenths of a mill of a dollar, or $0.0002, depending on the assets of the LLC that are situated and employed in Wyoming. The greater amount of the two must be paid. In Delaware, an LLC is not required to file an annual report, but it is subject to an annual tax of $250.

Some financial institutions require LLCs to get a certificate of good standing from their states' Secretary of State. The fee for this certificate in Delaware is $175 for a long form or $50 for a short form. A certificate of good standing is free of charge in Wyoming.

If you need help choosing between Wyoming and Delaware LLC, 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.