How to Form an LLC in Delaware

Everything you need to form a Limited Liability Company in Delaware (DE). Filing fee: $90 | Processing time: 3-5 business days (same-day and 24-hour expedited available)

Filing Fee
$90
Annual Report
$300 annual franchise tax
Processing Time
3-5 business days (same-day and 24-hour expedited available)
Online Filing
Yes

State Income Tax

2.2% to 6.6% individual income tax; 8.7% corporate income tax

Steps to Form an LLC in Delaware

1

Choose an LLC name and verify availability with the Delaware Division of Corporations

2

Designate a registered agent in Delaware

3

File the Certificate of Formation with the Delaware Division of Corporations

4

Pay the $90 filing fee

5

Obtain an EIN from the IRS

6

Create a comprehensive Operating Agreement

7

Pay the annual $300 franchise tax by June 1 each year

Step-by-Step Delaware LLC Formation Guide

Delaware is widely regarded as the most business-friendly state in America, and its Court of Chancery provides a specialized legal system for resolving business disputes. You will file your Certificate of Formation with the Delaware Division of Corporations, and the filing fee is just $90. Delaware's flexible LLC statute, strong privacy protections, and well-established case law make it the top choice for businesses of all sizes.

Step 1: Verify Your LLC Name Availability

Search the Delaware Division of Corporations' entity database to ensure your desired LLC name is available. Your name must contain "Limited Liability Company" or an accepted abbreviation. Delaware allows you to reserve a name for up to 120 days for a $75 fee, giving you time to finalize your formation documents.

Step 2: Designate a Registered Agent

Delaware requires every LLC to maintain a registered agent with a physical address in the state. Since many LLC owners form in Delaware but operate elsewhere, professional registered agent services are extremely common and widely available. Your registered agent receives legal documents and state correspondence, so choosing a reliable agent is essential.

Step 3: File Your Certificate of Formation

File your Certificate of Formation with the Delaware Division of Corporations online or by mail. The standard filing fee is $90, and expedited processing options are available for an additional cost. Delaware's Certificate of Formation is remarkably simple, requiring only the LLC's name and registered agent information. Same-day and 24-hour expedited processing are available for time-sensitive filings.

Step 4: Draft Your Operating Agreement

Delaware places enormous importance on the operating agreement as the primary governance document for an LLC. The Delaware LLC Act gives maximum effect to the terms of the operating agreement, allowing members wide latitude to customize their governance structure. You can tailor provisions for management, distributions, transfer restrictions, and fiduciary duties to suit your specific business needs.

Step 5: Obtain Your EIN from the IRS

Apply for your free Employer Identification Number through the IRS website. This number is required for federal tax filings, banking, and hiring. The online application is completed in minutes and provides instant confirmation of your EIN.

Step 6: Understand Delaware Tax Obligations

Delaware does not impose a state income tax on LLCs that do not operate within the state, which is a major draw for out-of-state businesses. However, all Delaware LLCs must pay an annual franchise tax of $300 to the Division of Corporations. If your LLC does conduct business in Delaware, you may also need to register with the Delaware Division of Revenue for applicable state taxes.

Step 7: Open a Business Bank Account

Open a dedicated business bank account using your Certificate of Formation and EIN. If you formed your LLC in Delaware but operate in another state, you can open your bank account in the state where you conduct business. Maintaining separate finances is essential for protecting your personal assets through the LLC structure.

Step 8: Pay Your Annual Franchise Tax

Delaware LLCs must pay a $300 annual franchise tax to the Division of Corporations by June 1 each year. This flat fee applies regardless of your LLC's revenue or activity level. Failure to pay the franchise tax will result in penalties and can eventually lead to administrative dissolution. Delaware does not require a separate annual report for LLCs, so the franchise tax payment is your primary annual compliance obligation.

Delaware's reputation as the premier state for business formation is well-earned, thanks to its flexible LLC statute, specialized courts, and strong privacy protections. The $300 annual franchise tax is a modest price for the legal advantages Delaware provides, especially for businesses seeking outside investment or operating across multiple states. Make sure your registered agent remains active and your franchise tax is paid by June 1 each year to keep your Delaware LLC in good standing.

Pros of Forming in Delaware

  • ✓Most business-friendly court system (Court of Chancery) in the US
  • ✓Strong legal precedents and flexible LLC laws
  • ✓Privacy protections — member names not required in public filings

Cons of Forming in Delaware

  • ✗$300 annual franchise tax adds to ongoing costs
  • ✗If you don't operate in Delaware, you'll need to register in your home state too
  • ✗Legal advantages mainly benefit larger companies or those expecting litigation

Best For

Businesses seeking strong legal protections, investor-friendly structures, or planning to raise venture capital.

Frequently Asked Questions About Delaware LLCs

How much does it cost to form an LLC in Delaware?▼
The filing fee to form an LLC in Delaware is $90, paid to the Delaware Division of Corporations. Delaware is well known for its business-friendly legal framework, making it a popular choice for LLC formation nationwide. Online filing is available through the Division of Corporations' website.
How long does it take to process an LLC filing in Delaware?▼
Standard processing for a Delaware LLC takes approximately 3 to 5 business days. Delaware offers several expedited processing options, including same-day service, 24-hour service, and next-day service for additional fees ranging from $50 to $1,000. This flexibility makes Delaware attractive for businesses that need to form quickly.
What are Delaware's annual requirements for LLCs?▼
Delaware LLCs must pay an annual franchise tax of $300 to the Division of Corporations. This tax is due by June 1 each year. Delaware LLCs do not file a traditional annual report. Failure to pay the annual tax on time results in a $200 penalty plus 1.5% monthly interest, and continued non-payment can lead to cancellation of your LLC.
What are the registered agent requirements for a Delaware LLC?▼
Delaware requires every LLC to have a registered agent with a physical street address in the state. The agent must be a Delaware resident individual or a business entity authorized to act as a registered agent in Delaware. Since many LLCs are formed in Delaware by out-of-state owners, professional registered agent services are widely used and readily available.
Is an operating agreement required for a Delaware LLC?▼
While Delaware law does not explicitly mandate a written operating agreement, the Delaware Limited Liability Company Act strongly supports and relies on operating agreements as the primary governing document for LLCs. Delaware courts place significant weight on operating agreements in disputes. It is considered essential to have a comprehensive written operating agreement for any Delaware LLC, especially given the state's well-developed body of LLC case law.
When does my Delaware LLC need an EIN?▼
Your Delaware LLC needs an EIN if it has multiple members, hires employees, or elects corporate tax treatment. Even single-member LLCs benefit from obtaining an EIN for banking, credit, and tax purposes. The IRS issues EINs for free, and you can apply online to receive one instantly.
Should I choose an LLC, S-Corp, or sole proprietorship in Delaware?▼
Delaware's individual income tax rates range from 2.2% to 6.6%, and the corporate rate is 8.7%. A sole proprietorship offers simplicity but no liability protection. A Delaware LLC provides strong legal protections thanks to the state's well-established Court of Chancery and LLC-friendly statutes. If your LLC generates significant income, an S-Corp election can reduce self-employment taxes. Many businesses form in Delaware for its legal advantages, even if they operate primarily in another state.
Why is Delaware considered the best state for LLC formation?▼
Delaware is renowned for its business-friendly legal environment, including the Court of Chancery, which specializes in business disputes and does not use juries. The Delaware Limited Liability Company Act provides maximum flexibility for structuring LLCs and strong protections for members. Delaware also offers privacy advantages since member names are not required on public filings. However, if you operate only in another state, you may still need to register as a foreign LLC there, resulting in additional fees and filings.
What is the Delaware Court of Chancery and why does it matter?▼
The Delaware Court of Chancery is a specialized equity court that handles business disputes without juries. It has over 200 years of case law and is staffed by judges with deep expertise in corporate and LLC law. This provides predictability and consistency in legal rulings, which is a major reason businesses choose Delaware. For LLC owners, this means greater certainty about how operating agreements and member disputes will be resolved.

Calculate Your Delaware LLC Costs

Get a detailed cost breakdown for forming your LLC in Delaware, including filing fees, registered agent costs, and more.

Use the Cost Calculator

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