Incorporate a LLC in Delaware USA from only $0 + state fees

Sole proprietorship: A sole proprietorship is the simplest form of business structure, where a single individual owns and operates the business. In this structure, there is no legal distinction between the owner and the business. The sole proprietor is personally responsible for all aspects of the business, including its debts, liabilities, and obligations.

Key characteristics of a sole proprietorship include:

Liability: The Owner of the business is solely responsible for business debts and liabilities as there is no distinction between the owner and the business. In sole proprietorships, owners' personal assets may be used to pay off business debts.

Taxation: Unlike other business structures in sole proprietorships, owners need to report their business income while submitting their personal income tax returns.

Setup: Sole proprietorships are one of the simplest and straightforward business structures. They are easy to set up and manage with minimal regulatory requirements.

Partnership: Partnership is a form of business structure where two or more people are involved in the business who share profits and losses of the business. In partnerships there is no / limited legal distinction between the owners and the business depending on the exact type of the partnership. For example, in General Partnerships business owners are liable for business debts. However, in Limited Partnerships partners can get limited liability and will be responsible for only the capital that they have invested in the business.

Most common types of partnerships in the USA are as follows:

General partnership (GP): This is the most common type of partnership where all partners share business profits, losses, and business liabilities. There is no liability protection, and any partner can commit the business to obligations.

Limited partnership (LP): Limited partnerships have two classes of owners, i.e., General Partners and Limited Partners. General Partners are fully liable for business debts, while the Limited Partners are only liable to the extent of the capital they have invested.

Limited liability partnership (LLP): LLPs are a more formal type of partnership in which all partners have limited liability to the extent of the capital that they have invested. LLPs need to be registered with relevant authorities and comply with regulatory requirements.

Limited liability company (LLC): LLC is one of the most popular business structures in the USA. LLCs have features of both a partnership and corporations. There is a legal distinction between the business and the business owners in LLC providing limited liability to owners. For tax purposes an LLC is sometimes treated as a partnership and corporation depending on the election made by the company. LLCs are controlled and managed by Managers / Members as set out in an operating agreement.

Corporation:

A corporation is a legal entity that is separate from its owners. Corporations can make a profit, be taxed, enter into contracts, and be held legally liable. Corporations have a board of directors and shareholders instead of partners. The ownership of the business is determined based on the number and value of shares held by the shareholders. A corporation is a complex structure and needs to comply with all regulatory requirements.

There are two types of Corporations in the United States:

‘C’ Corporation: ‘C’ corporations have shareholders and directors. Owners / Shareholders share ownership through stocks / shares. While the board of directors manages the business and ensures that the business is compliant with regulatory requirements. ‘C’ corporations are taxed separately from their owners. ‘C’ corporations need to pay tax on business income as per the corporate tax rates, and shareholders / owners pay tax on their personal income separately by submitting personal income tax returns (this may include any profits shared with owners in the form of dividends, etc.).

‘S’ Corporation: ‘S’ corporations are similar to ‘C’ corporations in many aspects, as they have shareholders and directors just like ‘C’ corporations. ‘S’ corporations also provide personal asset protection to shareholders / owners in the event of bankruptcy or debts. Owners are only liable to the extent of the capital / assets they have invested in the corporation. The major difference between ‘S’ corporations and ‘C’ corporations is that an ‘S’ corporation is not taxed based on the business income. Instead, shareholders pay tax on their share of income by submitting personal tax returns.

Delaware is known for its business-friendly laws, flexible corporate structure, and efficient court system, particularly the Delaware Court of Chancery, which specializes in corporate law. It offers advantages like no state income tax on corporations not operating in Delaware, confidentiality, and a streamlined registration process.

The US Constitution protects Delaware LLCs from discrimination based on where they were incorporated. Hence, Delaware LLCs can operate for any legal business in every state in the USA. However, there may be additional requirements of other states that companies must consider before starting trading in the desired state. Some of these requirements may include: filling a foreign qualification with the Secretary of State's office, paying a state filing fee, getting a Certificate of Good Standing from the state where the company is incorporated, hiring a registered agent in the desired state, etc.

No, LLCs do not have stocks / shares like corporations. The ownership of Members / Owners of LLCs are determined by the Operating Agreement created for the company. It comprises membership interests also known as membership units, that represent ownership of Members in the company.

EIN stands for Employer Identification Number, it is also known as a federal tax identification number, and is used to identify a business entity by the Internal Revenue Service (IRS).

In Delaware, businesses including sole proprietorships, partnerships, corporations, and limited liability companies (LLCs) are generally required to obtain an Employer Identification Number (EIN) if they have employees or meet specific criteria, such as withholding taxes on income paid to a non-resident alien. Specifically, an LLC will need an EIN if it has employees, operates as a multi-member LLC, or if it elects to be taxed as a corporation. Even for single-member LLCs with no employees, obtaining an EIN is often recommended for opening a business bank account, filing taxes, or dealing with vendors. Many of the banks also require an EIN for opening business bank accounts.

If you also need an EIN for your company, you can opt for our EIN application service via company formation add-ons while making your order.

We require ID documents for all Directors and Beneficial Owners of the company as well as the account handler of the company (if applicable ). The documents must be uploaded to our portal.

For our ID guide Click Here.

The formation process can vary based on when you present all the required documents needed to form an LLC. We will submit your application to Delaware Divisions of Corporations once your ID documents have been verified. Once submitted Delaware Divisions of Corporations can take from 24 hours to a few weeks to process the application. You can select the type of processing i.e. 24 hour processing, same day processing, etc. from our add on services while making your order. Fees paid for expedited processing are paid in full to Delaware Divisions of Corporations, we do not retain any amount from these fees.

Icon Offices is transparent about its fees and provides a clear breakdown of costs associated with company formation. However, additional fees may apply for services like expedited processing, obtaining an EIN, or maintaining a registered agent.

No, you do not need to be a U.S. citizen or resident to form a company in Delaware. Non-residents can establish businesses under U.S. law.

A registered agent is an individual or business designated to receive legal documents on behalf of your company. It is required by Delaware law for all companies to have a registered agent with a physical address in the state.

You can opt for our registered agent services starting from only $50. For more information, please click here.

Yes, you can operate your Delaware company from anywhere, but you may need to register as a foreign entity in your home state if you are conducting business there.

The name of your company must be unique and distinct from the names of existing entities. Hence, it is essential that you check if your desired company name is available or not.

You can use the name checker tool provided by Delaware Division of Corporations to ensure that the name you have selected is not being used already.

To check the availability of the name you have selected please Click Here.

Delaware LLCs must meet several compliance requirements to remain in good standing with the state. Key compliance obligations include:

1. Annual Franchise Tax
   Due Date: LLCs formed in Delaware pay a flat rate franchise tax of $300. LLCs must pay this annual franchise tax of $300 by June 1st each year.
   Annual Report: LLCs registered in Delaware do not need to submit an Annual Report unless the LLC has been elected to be treated as a corporation.


2. Registered Agent
   Every Delaware LLC is required to maintain a registered agent with a physical address in Delaware. The registered agent receives official legal documents on behalf of the LLC.


3. Operating Agreement
   While an Operating Agreement is not required to be filed with the state, Delaware LLCs are strongly advised to have one in place to outline the structure and operation of the business, especially in multi-member LLCs.


4. Employer Identification Number (EIN)
   An LLC needs an EIN if it has employees, operates as a multi-member LLC, or elects to be taxed as a corporation. Even for single-member LLCs, obtaining an EIN can be helpful for opening a bank account and other business activities.
5. Federal and State Taxes
   Federal Income Tax: An LLC is also required to file a federal income tax return each year without paying any income tax because an LLC is by default a pass-through entity unless it chooses to be taxed as a corporation. Should an LLC make such a choice, it will need to file the Federal Income Tax Return and pay federal income tax at the company level.
   State Tax: LLCs are taxed as disregarded entities (for single-member LLCs) or partnerships (for multi-member LLCs) and pass the tax liability to the owners. This means that the LLC does not have to pay State Income Tax other than the Franchise Tax stated above. Instead, the members of the LLC report their share of business income by submitting their personal income tax return.


6. Licenses and Permits
   Depending on the type of business, a Delaware LLC may be required to obtain specific business licenses or permits. These can vary by industry and location.


7. Maintaining Good Standing
   Failing to pay the annual franchise tax or maintain a registered agent can result in the LLC losing its good standing with the state, potentially leading to penalties or dissolution. Hence, complying with state and federal rules and regulations is essential for protecting the LLC’s limited liability status and avoiding penalties.

An operating agreement is a contract that governs the internal operations of a Limited Liability Company (LLC). It is not mandatory for LLCs to submit this document while incorporating, however each LLC must have an operating agreement and be kept for records. Once signed, the operating agreement is legally binding on all LLC members, establishing the rules, rights, and responsibilities that govern the business and its operations. Operating agreements also determine ownership of partners.

Yes, there are specific restrictions and requirements regarding the registered address of a Limited Liability Company (LLC) in Delaware. The registered address of an LLC in Delaware must be a physical location within the state, serve as the address for the registered agent, and must be kept current with the Delaware Secretary of State.

The fee paid to the Delaware Division of Corporations for LLC formation is non-refundable, even if the application is rejected. Our fee for company formation is also non refundable, even if the application is rejected.

If you want to apply again then you will have to pay our fee again at full price plus the government fee. However, if you pay $4.99 for company incorporation protection at checkout then you have the right to apply to incorporate your company again without making an additional payment to us. You will only need to pay the government fees required for the incorporation.

You can cancel and obtain a full refund from us at any time prior to us submitting your application to Delaware Divisions of Corporations. Once your application is submitted you do not qualify for a refund.