Benefits of a Delaware LLC

By
Leela Hopkins
VPM Staff
Updated
October 2, 2020

Delaware is one of the most popular states for businesses because it offers the following benefits.

Let’s cover the top reasons why Delaware may be the best state for you to form your next business.

Privacy Protection: Delaware LLCs are not required to list member names and addresses in their filings. Members and managers are only specified in the LLC’s operating agreement, which is private by nature. Therefore, ownership and management information is not recorded and available as public records.

Asset Protection: Delaware LLCs possess increased asset protection against creditors. This means that if a member of an LLC has a judgment filed against him/her, a creditor cannot attack the LLC or acquire any portion of the LLC's assets. This benefit protects everyone in the company.

Tax Benefits: Delaware does not tax companies that operate outside of its borders. This means you do not end up paying Delaware state taxes if you have no physical office or do business directly within the state.

Business Laws: Delaware has a well established Court of Chancery that allows business issues to be resolved quickly by a judge who specializes in corporate law and has expertise in resolving complex corporate disputes.

Simple Startup and Minimal Requirements: Very little information is required to form an LLC in Delaware and start-up involves only a small filing fee. Additionally, there are no meetings or voting requirements.

Low Annual Fees and Simple Maintenance: The cost to maintain a Delaware LLC is simple and inexpensive. Once a year, a simple form and an annual Franchise Tax Fee of $300 must be filed with the Delaware Secretary of State, and a Registered Agent Fee must be paid annually, as all Delaware LLCs are required by law to have a Registered Agent to accept service of process.

Ready to form your Delaware LLC? Follow our guide to register your Delaware LLC.