LLC in DE: If you want to form a Delaware LLC online or by mail, you need to submit the Articles of Organization with the Delaware Secretary of State for $90. For details, follow the 7 steps given in this article.
An LLC in Delaware basically links an organization’s limited liability with the pliability and shortage of formalities. All these are offered by any sole proprietorship or an association.
We would recommend setting up an LLC in DE for any entrepreneur whose objective is to restrict liability for professional lawsuits and debts.
Not from Delaware? Learn to form an LLC in any other State.
Tip of the Day: Delaware LLC formation by yourself is mostly hectic and time taking. Hiring a reliable LLC formation service is not only a good choice, but saves you from overspending. Therefore we recommend you to:
Now, what is an LLC? A Limited Liability Company (LLC) unites the best of partnerships, sole ownerships, and corporations into one organizational entity providing full protection to liabilities, tax incentives or flexible business structures, etc.
It only costs almost 90 USD to initiate an LLC in Delaware.
All you’ve to do is to submit a certificate of your new business with the State Minister.An entrepreneur can either apply online, drop a mail, or visit the office in person to build a new LLC.
In this article, we will explain the LLC formation method in Delaware. So let’s get started!
Outlining the LLC Formation Process
- Pick a Name for Your Delaware LLC
- Find a Registered Agent for Your LLC
- Submit the Articles of Organization
- Establish an LLC Operating Agreement
- Follow the Tax and Other Administrative Requirements
- Fulfill Your State Tax Commitments
- Submit Annual Reports
Next, we are going to discuss the steps one by one to make to clear for all of the viewers and new entrepreneurs.
#1: Pick an LLC Name
The first and foremost part of building an LLC in DE is to pick up the right company name. Try to select a name that corresponds to Delaware standards and is conveniently accessed by prospective customers.
What Instructions Should Be Followed While Naming an LLC?
- Every business owner should include “Limited Liability Company” to his new company or the abbreviation of it, LLC.
- Avoid using the words that can mystify your LLC name with the government agencies, such as State Organizations, Treasury, FBI, etc.
- Make sure to choose a unique name from other corporations, Delaware LLCs, or limited liability parties.
- If you want to fit in a few confined words like an attorney, bank, university, etc., it might demand hiring a licensed lawyer or doctor for additional documentation.
The next step is to verify access to your chosen name in Delaware. Make sure if the name is still available or utilized by another entity.
You can visit Delaware official state website to check on Business Registry Search. Furthermore, one can also generate a name through an LLC Name Generator online.
#2: Find a Registered Agent
Another vital step is to find a reliable Registered Agent to form an LLC in DE.
There are some limitations when choosing a registered agent in Delaware. The person should be a Delaware inhabitant who would be able to perform your business tasks from within the state.
You may also nominate yourself for the official documentation, but we personally recommend to go for ZenBusiness. Besides offering a free first year of their registered agent services, the company will form your Delaware LLC only for $49 plus state filing fee.
#3 File an Articles of Organization
During the formation of an LLC in DE, it’s crucial to submit your articles of organization linked with the Secretary of its State. A general article should cover up the following:
- Name and web address of your LLC’s planner
- The official name and address of Delaware LLC
- Details of your LLCs registered entity
- Details of your company members
- The official LLCs emails
- Entrepreneur’s signature
To file your certificate of organization online you need to complete the online application at the Delaware government’s website. You can also download the certificate of organization form and send it to the following address by mail or in-person:
Delaware Division of Corporations,
401 Federal St.,
Dover, DE 19901.
DIY Cost of Forming an LLC in Delaware ($90)
The main LLC formation cost through the DIY route is the state filing fee of your Article of Organization. Currently, the state of Delaware charges you $90 for filing your LLC and it may be subjected to revision by the state. The filing fee of articles of organization is the same, regardless you submit online or through the mail.
#4: Establish an LLC Operating Agreement
An LLC operating agreement is constitutional paperwork that sketches the rules and regulations for a new company and also outlines the entrepreneur’s operating procedures to form a new LLC in DE.
Although not necessary in all states, creating an operating agreement will benefit a company for sure. This legal agreement guarantees all entrepreneurs to remain on the same boat, which ultimately lessens further business clashes.
If you do not have an in-house team of lawyers or any attorney on board, do not worry. Many online LLC websites offer a full range of LLC-related services including operating agreement templates. You can subscribe to their full LLC package or opt for this standalone service.
#5: Follow the Similar Tax and Other Administrative Requirements
A few extra taxes and other administrative requirements might implement to your new LLC that includes:
Employer Identification Number – It is just like a Social Security Number, so if your company has more than one employee, you can get this EIN by paying extra. This nine-digit code will check into your tax issues and assist you in creating a new bank account, hiring new staff, etc. One can submit an online form at the IRS website to get an EIN for his company.
Official Licenses – Sometimes, your new LLC in Delaware might demand the official state licenses or other approvals, depending on the business type and its location. So, there are Economic Resource Units in Delaware leading you to authorities to guarantee proper licensing, registration, or permissions within the state.
#6: Fulfill Your State Tax Commitments
After getting a Delaware LLC, there are several responsibilities on a business entity that should be fulfilled. For instance, in a few cases, one has to check with the Delaware Department of Revenue (DEDOR) for selling products or assembling sales tax, etc.
For your convenience, IDOR has an online platform, so you can register yourself from there through Business Taxes Registration Application. For more information, you can review detailed LLC articles on our website.
#7: Responsibly Submit Annual Reports
Unlike other states, limited liability companies in Delaware are not obliged to submit their annual (or biennial) reports. For more details on how to file an annual report or state-specific fee, read our article on LLC annual (or biennial) report.
Due Date: In Delaware, you need to pay $300 as annual tax due before June 1st of every year. There is no requirement to file an Annual Report.
Late Filings: Failure to pay the required annual taxes will result in a penalty of $200.00 plus 1.5% interest per month on tax and penalty. Failure to file a biennial report may result in the dissolution of your LLC in Delaware.
Additional Information on Forming an LLC in Delaware
Register a Foreign LLC in Delaware
Entrepreneurs often form an LLC in a state other than the state of their residence to have some tax benefits and reduce LLC formation cost. Moreover, some business owners have their LLC franchises in multiple states. In such cases, they register their LLCs or franchises as foreign LLC in all states where they operate their business.
If you have an LLC in any other state and wish to open a franchise in Delaware or want to form an LLC in Delaware while you are a non-Delaware resident, you can download foreign LLC application mail it to the Delaware Division of Corporations, 401 Federal Street, Suite 4, Dover, DE 19901.
Delaware Foreign LLC Filing Fee: ($200 – nonrefundable)
Hiring Employees in Delaware
To run your business in a compliant manner, you have to follow the Delaware Department of Labor website’s Employer Handbook guidelines while hiring employees for your existing business or new LLC. Some of the major points are stated below;
- Verify the employment status of individuals, such as whether the potential employee is a US resident; if not then are they permitted to work in the US, are they of a certain age to work for that particular job, etc
- Report new hiring to the state
- File quarterly reports on wages and taxes
- Report job refusal
Acquire Relevant Business Licenses and Permits to Operate in Delaware
To successfully operate your LLC in Delaware, you must acquire permits and license to comply with federal, state, and local government regulations. For instance, to operate a pest control business, you need to acquire a license from the department of agriculture and fulfill the state’s certification requirement, etc.
The requirements and fees for business licenses and permits vary from state to state. Work thoroughly on prerequisites and compliance-related information for your business before officially filing your LLC with the state. However, the following resources may help;
- Hire a reliable, professional service like ZenBusiness to do a license and permit search for you. Many LLC formation services do this as a part of their LLC formation packages.
- Visit the US Small Business Administration (SBA) guide for federal license and permit information.
- The State of Delaware Website’s One Stop section helps you learn the state’s license requirements.
- Visit your local county clerk’s office and seek information about local licenses and permits.
Obtaining a Certificate of Good Standing in Delaware ($50 to $175 – nonrefundable)
A Certificate of Good Standing, aka Certificate of Compliance in Delaware, verifies that your LLC has been legally formed and is being operated and maintained in a compliant fashion. This document is needed for;
- Filing your business as a foreign LLC
- Seeking fundings and investments from banks or other people
- Acquiring or renewing relevant business licenses or permits
You can download the certificate of status and send it to the Division of Corporations, 401 Federal Street, Suite 4, Dover, DE 19901. You can also fax it to (302) 739-3812.
Dissolving Your LLC in Delaware
In case you no longer wish to continue your LLC in Delaware at any point in the future, you must officially dissolve it; otherwise, you may face tax liabilities, penalties, and legal troubles. In Delaware, you can dissolve your LLC by following 3 basic steps:
- Comply with your LLC operating agreement
- Close all business tax accounts
- You can hire top-ranked LLC services to make the LLC dissolution process seamless and easy for you. If you want to file yourself, follow the Delaware LLC dissolution guide.
LLC Dissolution Fee: ($200 – nonrefundable)
We hope this article has helped you in every aspect of forming an LLC in Delaware. If you still have any questions or confusion, please ask in the comment section.
Hi, Wilson here. I’m here to help small business owners and entrepreneurs form an LLC for free and affordable prices in any of the 50 States. In my opinion, Forming an LLC shouldn’t be so complicated, and I mean it. Stay with me to see how!