{"id":4800,"date":"2022-10-07T10:00:00","date_gmt":"2022-10-07T07:00:00","guid":{"rendered":"https:\/\/blog-new.workhy.com\/?p=4800"},"modified":"2022-10-05T11:23:24","modified_gmt":"2022-10-05T08:23:24","slug":"how-to-form-an-llc-in-delaware","status":"publish","type":"post","link":"https:\/\/workhy.com\/blog\/how-to-form-an-llc-in-delaware\/","title":{"rendered":"How to form an LLC in Delaware"},"content":{"rendered":"\n<p>Starting your own business in the US can be daunting, but if you set up the right type of company in the right state, you can reap the benefits quickly. One of the best options for this is to form an LLC in Delaware. In this article, we&#8217;ll walk you through all the steps you need to take to get your business off to a good start.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How to create an LLC in Delaware<\/strong><\/h2>\n\n\n\n<p>If you want to form an LLC in Delaware, one of the first things you\u2019ll need to do is registering your company with the <a href=\"https:\/\/corp.delaware.gov\/\" rel=\"nofollow noopener\" target=\"_blank\">Delaware Division of Corporations<\/a>. This government agency works with new business owners to form companies of all types, defining the rules for entrepreneurs across the country. The great news is that you can create an LLC in-state or out-of-state in Delaware.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>The steps you need to take to form an LLC in Delaware<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 1: Choose a name for your LLC<\/strong><\/h3>\n\n\n\n<p>As with any business and in any state, you\u2019ll need to choose a name before you do anything else. Delaware law states that anyone hoping to operate as an LLC must choose a unique company name. The bad news is that the name you pick must include either Limited Liability Company, LLC, or L.L.C at the end and cannot include the word &#8216;bank&#8217; or the name of a manager\/member of your LLC. To keep things simple, you can use the Division of Corporation\u2019s <a href=\"https:\/\/icis.corp.delaware.gov\/Ecorp\/NameReserv\/NameReservation.aspx\" rel=\"nofollow noopener\" target=\"_blank\">name availability search tool<\/a> to ensure your chosen name hasn\u2019t already been taken.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 2: Hire a registered agent<\/strong><\/h3>\n\n\n\n<p>Once your business name has been chosen, it\u2019ll be time to designate a <a href=\"https:\/\/workhy.com\/blog\/what-is-a-registered-agent\/\">registered agent<\/a>. This person will need to be able to accept legal documents and official mail on behalf of your LLC in Delaware. They will be legally obliged to notify you if your business is sued or receives legal notice from the government at any time. The only stipulation is that the chosen person must be a Delaware resident. A manager or a member of your LLC can take on the role of a registered agent, or you can hire companies that provide this service professionally.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 3: Get a Delaware business license<\/strong><\/h3>\n\n\n\n<p>Once you\u2019ve completed the first two steps, it\u2019s time to get a business license. Delaware requires you to apply for (and be awarded) a state business license from the <a href=\"https:\/\/revenue.delaware.gov\/\" rel=\"nofollow noopener\" target=\"_blank\">Delaware Division of Revenue<\/a>. The good news is that you can do this online via the website\u2019s \u2018One Stop\u2019 process; the fee can be anywhere between $50 and $450, depending on your business type.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 4: File your certificate of formation<\/strong><\/h3>\n\n\n\n<p>It\u2019s now time to officially form your LLC in Delaware by filing your certificate of formation, which may be called your\u00a0articles of organization, with the Delaware Division of Corporations. The certificate of formation for Delaware is rather straightforward and should only take three to four business days to process. It should detail:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Your LLC\u2019s name<\/li><li>The registered agent\u2019s name and address<\/li><li>The name and signature of the person who is filling out the form (this should be someone affiliated with the business)<\/li><\/ul>\n\n\n\n<p>It also needs a cover page. With approval, the state will send you a stamped copy and a business identification number that you need to use on any necessary state paperwork to identify your LLC moving forward.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 5: Create an LLC operating agreement<\/strong><\/h3>\n\n\n\n<p>Congratulations, you should now have officially formed your LLC in Delaware! But the hard work doesn\u2019t stop there. Your next priority should be drafting an LLC operating agreement. You\u2019ll need a formal, written operating agreement that contains:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The purpose of your LLC, including products and services offered<\/li><li>The names and addresses of the members (and manager, where applicable)<\/li><li>Each member\u2019s contributions of value to the LLC and ownership interest in the company, share of the profits and losses, and voting rights<\/li><li>Any procedures for admitting new members<\/li><li>Any procedures for electing a manager (if the LLC is managed)&nbsp;<\/li><li>Meeting schedules and any voting procedures<\/li><li>The dissolution process<\/li><\/ul>\n\n\n\n<p>Once this has been written up and all the information added, it should be reviewed and signed by each member of the LLC. As it stands, you are not obligated to file it with Delaware state, but it needs to be kept alongside other&nbsp;important business records for future reference.<\/p>\n\n\n\n<p>It\u2019s important to note that you should now apply for an EIN (or federal tax ID number). While not all LLCs will need one (it\u2019s mainly for businesses who have employees or multiple owners, and those who opt to be taxed as a corporation), it can be worthwhile to have one to hand when filing your business taxes, as well as for several other financial purposes.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Benefits of having an LLC in Delaware&nbsp;<\/strong><\/h2>\n\n\n\n<p>Delaware can be a great place to form an LLC with low fees and minimum tax obligations. Here are some other reasons why:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>No sales tax<\/li><li>No state income tax or gross receipt taxes for LLCs operating outside of Delaware<\/li><li>No tax on intangible income<\/li><li>No annual report filing<\/li><li>No business license is needed for LLCs operating outside of Delaware<\/li><li>Simple LLC formation document and filing process<\/li><li>Low LLC naming restrictions<\/li><li>Few reporting and record-keeping requirements<\/li><li>No double taxation (like with C-corporations)<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Establish your LLC in Delaware with Workhy<\/strong><\/h2>\n\n\n\n<p>You can choose <a href=\"https:\/\/workhy.com\/\">Workhy<\/a> to help you establish your LLC in Delaware online. With our knowledge focusing on the state of Delaware, you can rest assured that your business will be up and running in no time at all.<\/p>\n\n\n\n\t\t<!--HubSpot Call-to-Action Code -->\n\t\t<span class=\"hs-cta-wrapper\" id=\"hs-cta-wrapper-8d6dddf1-0984-4cf9-8f33-33622d4dedb6\">\n\t\t<span class=\"hs-cta-node hs-cta-8d6dddf1-0984-4cf9-8f33-33622d4dedb6\" id=\"8d6dddf1-0984-4cf9-8f33-33622d4dedb6\">\n\t\t<!--[if lte IE 8]>\n\t\t<div id=\"hs-cta-ie-element\"><\/div>\n\t\t<![endif]-->\n\t\t<a href=\"https:\/\/cta-redirect.hubspot.com\/cta\/redirect\/5318651\/8d6dddf1-0984-4cf9-8f33-33622d4dedb6\" rel=\"nofollow noopener\" target=\"_blank\">\n\t\t<img decoding=\"async\" class=\"hs-cta-img\" id=\"hs-cta-img-8d6dddf1-0984-4cf9-8f33-33622d4dedb6\" style=\"border-width:0px;\" src=\"https:\/\/no-cache.hubspot.com\/cta\/default\/5318651\/8d6dddf1-0984-4cf9-8f33-33622d4dedb6.png\"  alt=\"New call-to-action\"\/>\n\t\t<\/a>\n\t\t<\/span>\n\t\t<script charset=\"utf-8\" src=\"\/\/js.hubspot.com\/cta\/current.js\"><\/script>\n\t\t<script>\n\t\thbspt.cta.load(5318651, '8d6dddf1-0984-4cf9-8f33-33622d4dedb6', {});\n\t\t<\/script>\n\t\t<\/span>\n\t\t<!-- end HubSpot Call-to-Action Code -->\n\t\t\n","protected":false},"excerpt":{"rendered":"Starting your own business in the US can be daunting, but if you set up the right type&hellip;","protected":false},"author":14,"featured_media":4802,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","inline_featured_image":false,"csco_display_header_overlay":false,"csco_singular_sidebar":"","csco_page_header_type":"","footnotes":""},"categories":[1591],"tags":[1448,1483,1449,1475],"class_list":{"0":"post-4800","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-us-company-formation","8":"tag-us-company","9":"tag-us-company-establishment","10":"tag-us-company-formation","11":"tag-usa","12":"cs-entry"},"_links":{"self":[{"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/posts\/4800","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/comments?post=4800"}],"version-history":[{"count":2,"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/posts\/4800\/revisions"}],"predecessor-version":[{"id":4803,"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/posts\/4800\/revisions\/4803"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/media\/4802"}],"wp:attachment":[{"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/media?parent=4800"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/categories?post=4800"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/workhy.com\/blog\/wp-json\/wp\/v2\/tags?post=4800"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}