How Much Does it Cost to Form a Delaware LLC? Find out the fees associated with forming a Limited Liability Company in Delaware.
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If you’re thinking about starting a business, you may be considering a limited liability company (LLC). LLCs are a popular choice for small businesses because they offer personal asset protection and flexibility in how the business is structured and operated.
One of the main considerations when forming an LLC is what state to form the LLC in. Many businesses choose to form their LLC in Delaware because Delaware has favorable business laws and is home to many large businesses.
So, how much does it cost to form a Delaware LLC? The short answer is that it costs $90 to file the Articles of Formation with the Delaware Secretary of State. However, there are also annual filing fees and registered agent fees, which can add up. We’ll go over all the fees associated with forming and maintaining a Delaware LLC below.
The Basic Costs of Forming a Delaware LLC
The cost of forming a Delaware LLC varies depending on the service you use. The state of Delaware charges a $90 filing fee to form a new LLC. You will also need to pay a $35 annual report fee when you file your LLC’s annual report. If you use a service to form your LLC, you will likely pay a few hundred dollars for the service.
The Certificate of Formation
The first step in forming a Delaware LLC is to file a Certificate of Formation with the Delaware Secretary of State. The Certificate must contain the LLC’s name, address, registered agent information, and the names and addresses of the LLC’s organizers. The filing fee for the Certificate of Formation is $90.
After the Certificate of Formation is filed, the LLC must publish a notice of its formation in two newspapers of general circulation in Delaware. The cost of publication varies depending on the newspapers chosen, but is typically around $200.
The LLC must also file an annual report with the Delaware Division of Corporations. The report must contain information about the LLC’s members, managers, and registered agent. The report must be filed by June 1st and there is a $300 filing fee.
Registered Agent Fees
When you form a Delaware LLC, you’ll need to appoint a registered agent for your LLC. A registered agent is an individual or business that agrees to accept legal documents on behalf of your LLC.
Most registered agents in Delaware charge an annual fee for their services. This fee is typically between $50 and $500 per year. Some registered agents may also charge a one-time set-up fee when you first appoint them as your LLC’s registered agent.
The Cost of an LLC Operating Agreement
An LLC operating agreement is not required in Delaware, but we highly recommend that you have one. This document outlines the ownership and operations of your LLC, and can help you avoid disputes between members.
A Delaware LLC operating agreement typically costs between $75 and $200 to create.
Additional Costs to Consider
There are a few additional costs to consider when forming a Delaware LLC. First, you will need to get a registered agent. A registered agent is someone who is responsible for receiving legal documents on behalf of your LLC. You will also need to file an annual report and pay a franchise tax.
The Cost of Obtaining an EIN
An Employer Identification Number (EIN) is also known as a Federal Tax Identification Number, and is used to identify a business entity.
There are a few different ways to obtain an EIN. The most common way is to apply online through the IRS website. Applying for an EIN is a free service offered by the IRS.
Another way to obtain an EIN is to apply by fax or mail. To apply by fax, you must complete Form SS-4 and fax it to the appropriate IRS office. To apply by mail, you must complete Form SS-4 and mail it to the appropriate IRS office.
The final way to obtain an EIN is to apply in person at your local IRS office.
The cost of obtaining an EIN varies depending on how you apply. Applying for an EIN online is free. Applying for an EIN by fax or mail will cost $0.60 per form, plus any applicable user fees. Applying for an EIN in person will cost $85, plus any applicable user fees.
The Cost of Business Licenses and Permits
Depending on the business activities of your LLC, you may need to obtain one or more business licenses and permits. The type of license or permit required depends on the industry in which your LLC will operate and the specific regulations that apply to that industry.
For example, businesses that sell food or alcohol may need to obtain a license from the Department of Health, while businesses that engage in construction activities may need to obtain a general contractors license from the Department of Labor.
The cost of obtaining a business license or permit varies depending on the specific license or permit required, but can range from a few hundred dollars to several thousand dollars. In some cases, you may be able to apply for a reduced fee or waiver if your LLC is a small business or startup.
The Cost of Professional Services
Most people form LLCs with the help of an attorney or professional service. The cost of formation services will depend on how complex your LLC is and how much hand-holding you need.
If you have a simple LLC with one owner and no special circumstances, you can probably find online formation services that charge as little as $100. If you need help with a more complex LLC, expect to pay several hundred dollars.
For example, if you’re forming an LLC that will be owned by multiple investors, you’ll need to draft an operating agreement laying out the rules for how the business will be run. This document can be complex, and you may want to have an attorney review it to make sure it’s done correctly.
You may also want to hire a professional service if you’re forming an LLC for a high-risk business, such as a restaurant or a startup company. In these cases, it’s worth paying for peace of mind and knowing that your formation documents are in order.
How to Save on the Cost of Forming a Delaware LLC
The cost of forming a Delaware LLC can be greatly reduced by taking a few simple steps. You can save on the cost of formation by forming your LLC online, using a professional service, and by forming a series LLC. Let’s take a closer look at each of these steps.
Form Your LLC Online
It is possible to form your LLC online without the help of a lawyer or professional service. The Delaware Division of Corporations offers an online formation service that can be completed in a few steps.
To form your LLC online, you will need to:
-Choose a company name and register it with the state
-Select a registered agent
-File the Certificate of Formation
-Pay the filing fee
After your LLC is formed, you will need to draft operating agreements and file annual reports. You will also need to comply with all state and federal laws.
Use a Registered Agent Service
One way to save on the cost of forming a Delaware LLC is to use a registered agent service. A registered agent is a person or company that agrees to accept service of process and legal notices on behalf of your LLC.
Using a registered agent service can save you money because you don’t have to pay the fees associated with hiring a registered agent, and you don’t have to worry about meeting the requirements for maintaining a physical office in Delaware.
There are many reputable registered agent services available, and you can find one that fits your needs by doing a search online. Be sure to read reviews before making your decision, and make sure that the service you choose offers good customer support and is up-to-date on the latest Delaware LLC laws and regulations.
Do Your Own Research
One of the best ways to save on the cost of forming a Delaware LLC is to do your own research. The Delaware Division of Corporations offers an online searchable database of all business entities registered in the state. This is a great resource for finding out information about existing LLCs, such as the names and addresses of the members, and can give you an idea of what to expect when forming your own LLC.
Another way to save on the cost of forming a Delaware LLC is to use an online service such as LegalZoom or Incfile, which can help you complete and file the necessary paperwork. These services typically charge a flat fee, which can save you money on attorney’s fees.
You can also save on the cost of forming a Delaware LLC by forming your LLC in another state that has lower filing fees or fewer requirements. For example, Nevada has no state corporate income tax, while Wyoming does not require LLCs to file an annual report. If you are comfortable doing business in another state, this can be a good option for saving money on the formation of your LLC.
Overall, forming a Delaware LLC is not an expensive process. The state filing fee is reasonable, and there are no ongoing maintenance fees. However, you will need to engage the services of a registered agent, which will incur a annual fee. You may also need to obtain a business license from your local municipality, which could involve additional fees.
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