Delaware LLC vs Wyoming LLC
Side-by-side comparison across banking, cost, speed, tax efficiency, and investor friendliness.
The short answer
For most bootstrapped owners, Wyoming is the cheaper and simpler choice. A Wyoming LLC runs about $60 a year for its annual report; a Delaware LLC pays a flat $400 annual tax every year (raised from $300 under House Bill 400, from tax year 2026). Add a registered agent for an out-of-state owner (roughly $125 a year either way) and the all-in yearly cost is around $185 for Wyoming versus about $525 for Delaware. Over five years that is more than $1,500 in extra Delaware fees for essentially the same structure (verify current rates).
Delaware earns its premium in one situation: raising venture capital. Investors and their attorneys standardize on Delaware entities, usually C-Corps, and Delaware's Court of Chancery and deep case law matter when there are co-founders, outside investors, or complex equity on the table. For a solo owner running consulting, e-commerce, or SaaS with no investors, those advantages rarely come into play.
On taxes the two are a wash. A standard LLC is a pass-through, so profits are taxed where the owner lives, not where the LLC is formed. Wyoming has no state income tax at all; Delaware does not tax LLC income earned outside the state. Neither choice changes your federal bill. On privacy the two are closer than the marketing suggests: neither Delaware nor Wyoming lists LLC members or managers on the public record. Wyoming keeps a small edge because its filings carry less (a short annual report, no franchise-tax account), and if privacy is the whole point, New Mexico goes further with no annual report at all.
If you plan to raise a priced round or expect complex disputes, Delaware is the path of least resistance, and a Wyoming LLC can be converted to a Delaware C-Corp later when the time comes. Otherwise Wyoming saves real money with no meaningful downside.
General information, not legal or tax advice. Rates and fees change; verify with the state or a qualified professional.
How they compare
- Delaware LLC scores highest on legal predictability.
- Wyoming LLC scores highest on low ongoing cost and admin simplicity.
- Both score 8 out of 10 on reputation safety.
- Both score 7 out of 10 on banking access.
Comparison of relative scores (0 to 10), not advice. Scores reflect general jurisdiction characteristics, not your specific situation.
Radar chart comparing scores out of 10 across nine dimensions. Delaware LLC: Banking access 8 out of 10, Low ongoing cost 4 out of 10, Setup speed 7 out of 10, Admin simplicity 5 out of 10, Tax efficiency 6 out of 10, Investor friendliness 6 out of 10, Legal predictability 9 out of 10, Privacy 6 out of 10, Reputation safety 9 out of 10. Wyoming LLC: Banking access 7 out of 10, Low ongoing cost 7 out of 10, Setup speed 7 out of 10, Admin simplicity 7 out of 10, Tax efficiency 6 out of 10, Investor friendliness 5 out of 10, Legal predictability 7 out of 10, Privacy 7 out of 10, Reputation safety 8 out of 10.
Delaware LLC
LLCUS entity wrapper / holding structure (not VC-optimized)
Pass-through: profit is taxed at owner level, where the owner lives. A non-US owner with no US trade or business generally owes no US federal income tax.
Best for
- Holding companies or asset protection wrappers
- Consulting and professional services firms
- Real estate investment vehicles
- Pass-through taxation for US-based founders
Look out for
- Not ideal for raising VC (investors prefer C-Corp structure)
- Foreign-owned LLCs trigger extra IRS reporting (Form 5472)
- Delaware franchise tax applies even to dormant LLCs
Wyoming LLC
LLCOwner-operated businesses prioritizing low ongoing overhead
Pass-through: profit is taxed at owner level, where the owner lives. A non-US owner with no US trade or business generally owes no US federal income tax.
Best for
- Solo founders wanting minimal state fees
- Digital nomads needing a US entity for payments
- E-commerce operators with no physical US presence
- Asset protection for personal liability shielding
Look out for
- Less investor credibility compared to Delaware
- Thinner body of case law than Delaware's Court of Chancery
- May need to foreign-qualify in states where you actually operate
Affiliate disclosure: IncorpAssist may earn a referral fee if you form through one of these links, at no extra cost to you. It does not change anything written above.
Key differences
Common questions
Is Wyoming or Delaware better for an LLC?
For a solo owner or small team with no plans to raise venture capital, Wyoming is generally better: it costs roughly $185 a year all-in versus about $525 for Delaware, with a slight privacy edge (neither state lists members or managers publicly, but Wyoming's filings carry less). Delaware is the better choice mainly when institutional fundraising is planned, because investors expect Delaware entities, or when co-founders and complex equity make Delaware's established corporate case law worth paying for. For most bootstrapped businesses, Wyoming wins on cost with no meaningful downside.
What does a Delaware LLC vs a Wyoming LLC cost per year?
A Wyoming LLC pays about $60 a year for its annual report. A Delaware LLC pays a flat $400 annual franchise tax (from tax year 2026; it was $300 before House Bill 400). An owner based outside the state needs a registered agent in either case, typically around $125 a year, so the all-in yearly cost is roughly $185 for Wyoming and about $525 for Delaware. Formation is comparable: around $100 in Wyoming and $110 in Delaware (verify current rates with a local advisor).
Do Delaware and Wyoming tax LLC income differently?
Generally no. A standard LLC is a pass-through, so profits are taxed where the owner lives, not where the LLC is formed. Wyoming has no state income tax at all. Delaware does not tax LLC income earned outside Delaware by non-residents. One trap applies regardless of formation state: if you live or do business in California, you owe California's $800 minimum franchise tax and its gross-receipts fee no matter where the LLC is formed.
Can I convert a Wyoming LLC to a Delaware C-Corp later?
Yes. This is done through conversion or domestication, and both states support it. Many founders start with a low-cost Wyoming LLC and convert to a Delaware C-Corp when they are ready to raise a priced round. The process involves filing in both states and usually costs a few hundred dollars in filing fees, plus legal costs if an attorney handles it.
Is a Wyoming LLC more private than a Delaware LLC?
Yes, by default. Wyoming does not require public disclosure of LLC members or managers; its formation documents list only the registered agent and organizer. Delaware also keeps members private but requires at least one manager or authorized person on the public record. If a cheaper option with similar privacy matters more than recognition, New Mexico charges $0 a year and also keeps members off the public record.