Delaware LLC Costs
A limited liability company, or LLC, is a business structure that gives business owners liability protection, unique tax advantages, and a flexible management organization. Business owners often have a misconception that forming an LLC is time-consuming and too expensive. But, the process is straightforward and cost-effective in the long run.
Recommended LLC Services
Costs to start an LLC in Delaware
Certificate of Formation fee ($90)
- You will file the Certificate of Formation with the Delaware Department of State.
- The Delaware filing fee for the Certificate of Formation is $90.
- Delaware does offer expedited LLC services. 1-hour -$1000, 2-hour – $500, Same day -$200, Next date – $100.
Delaware franchise tax ($300)
- LLCs in Delaware must file and pay a $300 annual franchise tax.
- You can file your annual franchise tax through the Delaware Corporations Information System.
- The penalty for failure to pay the annual tax by the June 1 filing deadline is $200 plus 1.5% interest a month.
Delaware registered agent fee (varies between $50 to $300)
- You can act as your own registered agent in Delaware. Professionals recommend that you appoint an experienced registered agent to avoid late fees.
- A registered agent service receives and maintains documents and legal papers for your LLC, including subpoenas, tax notices, and outside correspondence.
- The cost for a registered agent will vary depending on the service, your company needs, and Delaware state fees.
Fees to form a foreign LLC in Delaware ($200)
- You must register an LLC as a foreign if you have an existing LLC registered in another state.
- The fee for registering a limited liability company as a Delaware foreign LLC is $200.
- You must complete and submit the Certificate of Registration of Foreign Limited Liability Company to the Delaware Division of Corporations.
LLC name reservation fee ($75)
- Delaware does not require you to reserve a name before LLC formation. However, it makes registering your LLC a more straightforward process.
- You can reserve the LLC name up to 120 days before LLC formation.
- You will complete and submit the Application for Reservation of Limited Liability Company Name with the $75 filing fee.
DBA filing fees in Delaware ($25)
- The business-related acronym DBA is an abbreviation for ’doing business as.’ A DBA is a registered name an individual or company uses to conduct business that is not the legal name.
- You will complete and submit the Registration of Trade, Business & Fictitious Name Certificate to the local Prothonotary’s Office.
- The DBA filing is $25 in Delaware.
Cost of certified document copies ($50)
- You will visit the Delaware Division of the Corporation‘s website to order your certified copies.
- The cost of certified copies of your Delaware LLC documents is $50 and $2 for every page.
Certificate of Good Standing ($50)
- Some banks and banking institutions require that you obtain a Delaware Certificate of Good Standing.
- You can order the Certificate of Good Standing using the Delaware Department of State website.
Steps to start an LLC in Delaware
Choose a business name in Delaware
You will need to consider a few things when choosing a Delaware LLC name.
- It must be available for use in Delaware.
- It must meet the state LLC name requirements and restrictions. Find a complete list of LLC naming mandates.
- It is a good idea to check for web domain availability.
You will use the Delaware Trade, Business & Fictitious Names search and check for LLC name availability.
LLC name reservation fee
You can reserve your Delaware LLC name up to 120 days before LLC formation.
You will complete and submit the Application for Reservation of Limited Liability Company Name to your local County Clerk’s Office.
The cost to reserve a Delaware LLC name for up to 120 days is $75, and name reservation is not mandatory.
Appoint a Delaware registered agent
You must appoint a registered agent in Delaware when you form an LLC in the state.
The cost for a registered agent in Delaware varies between $50 to $300 per year depending on your LLC needs.
A registered agent in Delaware is an individual or business entity that receives tax forms, legal documents, subpoenas, civil notices, service of process, and other official government correspondence on behalf of a sole proprietorship, corporation, or LLC.
The registered agent you choose must be a Delaware resident or a registered agent service authorized to conduct business in the state.
- Starter Plan – $39 a year plus State Fees
- Pro Plan – $149 a year plus State Fees
- Premium Plan – $249 a year plus State Fees
ZenBusiness offers a stand-along registered agent service. The price is $99 per year.
- Total Out The Door Delaware LLC Formation Service Package – $49 a month and includes:
- Delaware State Fee
- Filing Service Fee
- Registered Agent
- Tax ID
- Annual Plan – $225 plus State Fees a year
- Economy – $79 plus $153 Delaware filing fees
- Standard – $329 plus $153 Delaware filing fees
- Express Gold – $349 plus $255 Delaware filing fees
File Delaware Certificate of Formation
You will file the Certificate of Formation with the Delaware Department of State.
You will file online using the Division of Corporations website.
Or, you can complete the State of Delaware Certificate of Formation of Limited Liability Company and submit it by mail. The form is a template with instructions you must follow.
Delaware Division of Corporations
401 Federal St.
Dover, DE 19901
The form will ask for specific information about your LLC.
- LLC name
- Detailed instructions for the Certificate of Formation form
- Registered agent information
The filing fee for your Delaware Certificate of Formation is $90.
Get a Delaware LLC EIN
An Employer Identification Number, or EIN, can also be referred to as a Federal Employer Identification Number (FEIN) or Federal Tax ID Number (FTIN).
The Internal Revenue Service (IRS) assigns EINs for no charge. The 9-digit number helps identify companies for income tax purposes and acts as a Social Security number.
The IRS requires that you get an EIN for your Delaware LLC if you are converting a sole proprietorship into an LLC.
Applying for an EIN is a simple process done online through the IRS website.
Business banking for a Delaware LLC
It is a best business practice to keep your personal banking account separate from your LLC business bank account. You do this to protect your personal assets and credit scores.
You will need a copy of the Certificate of Formation, your LLC’s operating agreement, and the EIN to open a new business bank account in Delaware.
A business banking account is usually free of charge and does not come with additional charges and fees.
Business attorney fees in Delaware
Opting to hire a business attorney makes the LLC formation process more manageable, and it is the lawyer‘s job to handle any business-related issues that may arise.
Business attorneys typically offer free consultations for first-time clients.
Professional services such as LegalZoom and Rocket Lawyer offer LLC formation packages that include comprehensive legal services.
On average, a professional business lawyer will cost $300 per hour.
LLC taxes in Delaware
In Delaware, LLCs are considered pass-through entities. Your LLC members must file their personal taxes rather than the LLC’s state tax return with the Delaware Department of Revenue.
- The total gross revenue of your business is assessed to decipher your Gross Receipts Tax and depends on the type of business.
- Delaware has an annual franchise tax of $300.
- As one of five states, Delaware does not require you to pay sales tax on taxable goods and services.
- You must register for Unemployment Insurance Tax if you have employees in Delaware.
- If you are required to pay Delaware Withholding business tax, you have to register online with the Delaware Division of Revenue.
- If you are a multi-member LLC in Delaware, you will need to file form 300-I.
- State and federal taxes are complicated, making consultation fees worthwhile for most.
Business licenses and permits in Delaware
The permits and Delaware business licenses you will need will depend on your location and the type of business you own.
You will also need to contact the Delaware Division of Professional Regulations to ask about what licenses and permits you need to operate in the state.
In Delaware, the average cost for a business license is $75 for the first buisness location and $25 for every additional location.
You will find that every county and city requires different things and have different rules for permits and licenses. You will want to check with your local government offices to inquire about the process, price, and business hours.
You may find that a Delaware LLC document or form requires notarization by a notary public.
Most government agencies have one in their offices if you cannot find a notary public.
In Delaware, a notoary public can charge the 5$ per notary public act with the max of $25.
Employer obligations in Delaware
You have specific obligations you must meet if you hire employees in Delaware.
- You must verify that every new employee is eligible using Form I-9 from the USCIS Website.
- You must purchase worker’s compensation insurance when you hire your first employee.
- You must report all new hires to the state.
Benefits of a Delaware LLC
- When you form an LLC in Delaware, you are simplifying business banking. Most financial institutes require you to open a separate business account from your personal banking account. It reduces your personal liability for LLC debts and future lawsuits.
- LLCs and corporations have different compliance requirements. Corporations must answer to stockholders and shareholders when they make business decisions.
- You are not subject to double taxation as an LLC. Specific business entities like C-corporations are double-taxed in Delaware.
- LLCs are pass-through entities. In Delaware, forming an LLC ensures that your company earnings are only taxed once through the member’s personal tax returns.
- The Court of Chancery in Delaware handles business disputes. Judges that specialize in business affairs hear lawsuits involving business statutes. Juries are not involved.
How long does it take to register an LLC in Delaware?
Delaware’s LLC business formation process takes 9 to 11 weeks if you file online or 10 to 12 weeks if you have filed by mail.
Delaware does offer expedited LLC services:
1-hour – $1000
2-hour – $500
Same business day – $200
Next date – $100
Why should I form an LLC in Delaware?
Regardless of your business structure, forming an LLC in Delaware is a good idea. It helps to limit your personal liability in potential lawsuits and business debt. The formation process for a Delaware Liability Company provides you with management flexibility, taxation, and ownership.
How do I dissolve my Delaware LLC?
You can file the Certificate of Cancellation online. Or, you can complete and submit the State of Delaware Certificate of Cancellation form by mail.
The fee to dissolve your Delaware LLC is $200.
Do I need a business operating agreement for my LLC in Delaware?
Delaware LLCs do not have to file an LLC operating agreement with the state. However, most companies choose to utilize one because it prevents managerial and financial misunderstands between owners.
Are there publication requirements in Delaware?
Delaware law does not state that you must publish the formation of your LLC. But, when you publish a public notice for your new LLC, it establishes you as a brand and is an easy advertisement.
Is a Delaware LLC worth it for a small business?
LLC formation in Delaware benefits small businesses, startups, and entrepreneurs. It gives your company credibility, liability protection, and access to special tax breaks.
You can form a single-member LLC. It helps if you plan on adding a co-owner down the road.
Can I take money out of my LLC in Delaware?
Single-member LLC owners do not get paid wages or a yearly salary. Instead, they pay themselves from a Delaware LLC’s profits. The practice is called an owner’s draw.
In Delaware, it is legal to write yourself a check as a single-member LLC owner and transfer those funds to your personal bank account.
Find out how much it costs to start an LLC in your state
Click below to get started.